[Senate Hearing 115-188]
[From the U.S. Government Publishing Office]
S. Hrg. 115-188
IMPROVING OVERSIGHT OF THE REGULATORY PROCESS: LESSONS FROM STATE
LEGISLATURES
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HEARING
before the
SUBCOMMITTEE ON
REGULATORY AFFAIRS AND FEDERAL MANAGEMENT
of the
COMMITTEE ON
HOMELAND SECURITY AND
GOVERNMENTAL AFFAIRS
UNITED STATES SENATE
ONE HUNDRED FIFTEENTH CONGRESS
FIRST SESSION
__________
OCTOBER 26, 2017
__________
Available via http://www.fdsys.gov
Printed for the use of the Committee on Homeland Security
and Governmental Affairs
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COMMITTEE ON HOMELAND SECURITY AND GOVERNMENTAL AFFAIRS
RON JOHNSON, Wisconsin, Chairman
JOHN McCAIN, Arizona CLAIRE McCASKILL, Missouri
ROB PORTMAN, Ohio THOMAS R. CARPER, Delaware
RAND PAUL, Kentucky JON TESTER, Montana
JAMES LANKFORD, Oklahoma HEIDI HEITKAMP, North Dakota
MICHAEL B. ENZI, Wyoming GARY C. PETERS, Michigan
JOHN HOEVEN, North Dakota MAGGIE HASSAN, New Hampshire
STEVE DAINES, Montana KAMALA D. HARRIS, California
Christopher R. Hixon, Staff Director
Margaret E. Daum, Minority Staff Director
Laura W. Kilbride, Chief Clerk
SUBCOMMITTEE ON REGULATORY AFFAIRS AND FEDERAL MANAGEMENT
JAMES LANKFORD, Oklahoma, Chairman
JOHN MCCAIN, Arizona HEIDI HEITKAMP, North Dakota
ROB PORTMAN, Ohio THOMAS R. CARPER, Delaware
MICHAEL B. ENZI, Wyoming MAGGIE HASSAN, New Hampshire
STEVE DAINES, Montana KAMALA D. HARRIS, California
John Cuaderes, Staff Director
James Mann, Counsel
Eric Bursch, Minority Staff Director
Anthony Papian, Minority Professional Staff Member
C O N T E N T S
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Opening statement:
Page
Senator Lankford............................................. 1
Senator Heitkamp............................................. 2
Senator Carper............................................... 16
Prepared statement:
Senator Lankford............................................. 27
Senator Heitkamp............................................. 29
WITNESSES
Thursday, October 26, 2017
Hon. Scott Bedke, Speaker of the House of Representatives, State
of Idaho....................................................... 4
Hon. Joshua A. Boschee, Member of the House of Represenatives,
Legislative Assembly, State of North Dakota.................... 5
Hon. Arthur O'Neill, Member of the House of Representatives,
General Assembly, State of Connecticut......................... 9
Alphabetical List of Witnesses
Bedke, Hon. Scott:
Testimony.................................................... 4
Prepared statement........................................... 30
Boschee, Hon. Joshua:
Testimony.................................................... 5
Prepared statement with attachment........................... 34
O'Neill, Hon. Arthur:
Testimony.................................................... 9
Prepared statement with attachments.......................... 47
IMPROVING OVERSIGHT OF THE
REGULATORY PROCESS: LESSONS FROM STATE LEGISLATURES
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THURSDAY, OCTOBER 26, 2017
U.S. Senate,
Subcommittee on Regulatory,
Affairs and Federal Management,
of the Committee on Homeland Security
and Governmental Affairs,
Washington, DC.
The Committee met, pursuant to notice, at 10:05 a.m., in
room 342, Dirksen Senate Office Building, Hon. James Lankford,
Chairman of the Subcommittee, presiding.
Present: Senators Lankford, Daines, Heitkamp, Carper,
Hassan, and Harris
OPENING STATEMENT OF SENATOR LANKFORD\1\
Senator Lankford. Good morning. Welcome to today's
Subcommittee hearing entitled Improving Oversight of the
Regulatory Process: Lessons from State Legislatures. This
hearing provides an opportunity to do something Washington
should do more often--listen. Listen and try to learn to see
what States do well, especially when it pertains to
regulations.
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\1\ The prepared statement of Senator Lankford appears in the
Appendix on page 27.
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Today we have three States that have found effective ways
for their legislatures to provide oversight over State
rulemaking agencies. Strong and effective legislative oversight
does not mean stopping agencies from issuing rules and it does
not mean we must have an adversarial relationship with the
regulators. When regulators do not trust or work with a
legislature, they push the bounds of their authority. This
leads to lawsuits, challenging nearly every aspect of
rulemaking, which draws out the process, creating uncertainty
for individuals and our communities.
On the other hand, as we will hear today, a cooperative
relationship between agencies and the legislative body leads to
more effective and efficient rules that follow legislative
intent and incorporate the views of regulated parties.
Regulators working closely with the legislature, results in
regulations that face far fewer lawsuits from stakeholders.
The onus to improve the rulemaking process is not just on
the regulators. As legislators, we must fulfill our
responsibility to actually legislate. For decades, we have
fallen into the habit of passing legislation that is vague on
the details and tell the agencies to do the hard work and
figure out how to be able to apply it. Politically, this
insulates the legislature, and we can say that we did our part
but the agency messed up the implementation. It is not how
government is supposed to work.
Many States, like Connecticut, North Dakota, actively
review State regulations to ensure they follow legislative
intent. Other States like Idaho codify State regulations after
a year or they expire. This causes the legislature to take
responsibility for not only the bills they pass but also for
the regulations that are a direct result of those lost.
When we talk about regulatory reform, I frequently hear
assertions that changes to our system will result in the
ossification of the rulemaking process, clog the courts,
prevent agencies from issuing needed regulations, or create
significant risks to health, safety, or the environment. But
many of the ideas that we have considered in Committee are
already being used in success on the State level, and I think
we can learn a lot today from this, so I am looking forward to
the conversation.
With that I would recognize the Ranking Member, Heidi
Heitkamp, for her opening remarks.
OPENING STATEMENT OF SENATOR HEITKAMP\1\
Senator Heitkamp. Thank you, Chairman Lankford. First I
would like to recognize a great friend and a great legislator,
Joshua Boschee, who is from my home State of North Dakota. I
have known Josh for a long time, fairly long time, and while he
is a tremendous legislator he is an even better person, and I
will tell you one of the finest North Dakota could send here.
So thanks so much, Josh, for making the trip. He is someone who
does not just talk about making things better. He rolls up his
sleeves and goes to work, and I am glad that he can be here
today to talk about how North Dakota does things right there
back home.
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\1\ The prepared statement of Senator Heitkamp appears in the
Appendix on page 29.
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So over the past 3 years we have been leading this
Committee, we have spent a lot of time examining the regulatory
process, from the basic framework of the rulemaking process to
the doctrines that are applied in court to the nitty-gritty of
how decisions are made on an agency level. From these
examinations legislators have flowed--legislation has flowed,
trying to adopt different ideas that have been discussed in
those hearings.
What we have not done enough of is look beyond the process
in Washington. This hearing is a great way to learn about the
activities of our partners in governance, on the States, to
learn about how they have tackled many of the same questions
that we have considered in this Committee, and to basically let
the 50 laboratories of government work and inform some of the
practices that we do right here.
If anyone has been following this Committee, they know that
frequently I ask about the intersection between Federal
regulation and State regulation, because a lot of challenges
that we have here, for overregulation, are duplicative
regulation, or inconsistent regulation is really that push
between State and local regulation and Federal regulation. And
a lot of us believe that if the State is already protecting
public health and safety, that that is the level at which those
institutions are most accountable.
And so we definitely want to hear not only your opinion
about what you do but maybe some of the frustration about the
duplication that you see in regulatory effort with Federal
regulation.
And so with that, Mr. Chairman, congratulations. This is a
great opportunity for us to learn a lot more about how things
could work better and how we could work better with State
regulators.
Senator Lankford. That is great. Thank you. At this time we
will proceed with testimony from our witnesses. First up we
have Mr. Scott Bedke. He is the Speaker of the Idaho House of
Representatives, a position that he has held since 2012. He is
serving his ninth term in the Idaho House, representing the
27th District. Speaker Bedke is a fourth-generation rancher
from Oakley, Idaho.
Following him will be Mr. Joshua Boschee, who is
representing North Dakota's 44th District in the North Dakota
House of Representatives since 2013. He serves on the
Government Finance Committee, Workers' Compensation Review
Committee, and Administrative Rules Committee. Representative
Boschee is a resident of Fargo, North Dakota, and I fully
expect to keep a stroke count of how many times I hear, between
the two of you, ``oh yes, you betcha'' today. [Laughter.]
So we will see if we can increase the number of times on
that.
Senator Heitkamp. Ya.
Senator Lankford. Third up will be Mr. Arthur O'Neill. He
is representing Connecticut's 69th District in the Connecticut
House of Representatives since 1988. He has served as the Chair
of the Regulations Review Committee as well as the Ranking
Member of the House Appropriations and Judiciary Committees.
Representative O'Neill is a resident of Southbury, Connecticut.
Thank you for being here as well.
It is a tradition of this Committee and the custom to be
able to swear in all witnesses that appear before us, so I
would ask all three of you to please stand and raise your right
hand.
Do you swear the testimony you will give before this
Subcommittee will be the truth, the whole truth, and nothing
but the truth, so help you, God?
Mr. Bedke. Yes.
Mr. Boschee. Yes.
Mr. O'Neill. Yes.
Senator Lankford. Thank you. You may be seated. Let the
record reflect all the witnesses have answered in the
affirmative.
We do have a timing system. You can see a clock in front of
you. As you start that will count down 5 minutes. We are not
going to be strict on that but we do want to leave as much time
as we can for questions, as Senator Heitkamp and I will pummel
you with questions as soon as you finish up your oral
testimony.
So, Speaker Bedke, you are up first.
TESTIMONY OF THE HONORABLE SCOTT BEDKE,\1\ SPEAKER OF THE HOUSE
OF REPRESENTATIVES, STATE OF IDAHO
Mr. Bedke. Thank you, Senator, and Senator Heitkamp. Thank
you for this opportunity to testify today.
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\1\ The prepared statement of Mr. Bedke appears in the Appendix on
page 30.
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Legislative review of Executive Branch rules is a topic of
great and recent interest in Idaho. Over the past 25 years or
so, the Idaho Legislature's authority to review Executive
Branch rules has been the subject of Supreme Court cases and no
less than two proposed constitutional amendments placed before
the voters of our State. Within the past year, at the 2016
general election, the voters of Idaho approved a constitutional
amendment providing that the legislature has the constitutional
authority to review and approve or reject Executive Branch
rules. As a result, the Idaho Legislature now has the
constitutional authority to ensure Executive Branch rules are
written in a manner consistent with the legislature's intent.
In Idaho, the legislature's authority to review and approve
or reject Executive Branch rules has been in place in one form
or another since 1969. In 1978, the legislature passed a
statute authorizing legislative subcommittees to meet in an
advisory fashion to either accept or reject administrative
rules. This advisory process evolved over time through statute
to provide a more formal and enhanced legislative role. This
statutory evolution provided the legislature with authority to
review administrative rules and, upon finding a rule
inconsistent with the legislative intent to reject that rule
through Concurrent Resolution. In Idaho, Concurrent Resolutions
require approval of both the House and the Senate and are not
subject to approval of the Governor.
In 1990, the legislature's authority to review and reject
administrative rules was upheld by the Idaho State Supreme
Court in a closely decided decision, with a 3-2 decision. The
court reasoned that the Executive Branch's authority to write
administrative rules is a power delegated to the Executive
Branch by the legislature. As our Supreme Court has held
repeatedly, only the legislature can make law.
The Idaho Legislature takes its responsibility in this area
very seriously. Each legislative session starts with an in-
depth review of the rules proposed in the preceding year. Each
legislative committee reviews the rules germane to its area of
expertise and makes recommendations to the House and Senate as
to whether those rules should be approved or rejected.
The legislature has used its authority to reject rules
judiciously. Over the past four decades, the legislature has
reviewed more than 5,000 administrative rules and has rejected
approximately 300, or approximately 6 percent. Often a rejected
rule is proposed again by the same Executive Branch agency the
next year, but with the changes necessary to make the rule
consistent with the legislative intent of the statute. In
Idaho's approach to this manner, the legislature's review of
rules does not hamper Executive Branch authority. It only
assures that State agencies are following the law in the
rulemaking.
The legislature acknowledges that at times Executive Branch
agencies may not understand or appreciate the real-life impacts
of their proposed rules, so legislative committees and their
elected officials listen to input from everyday citizens as to
how a new rule may affect them. To reiterate, the time we take
during this process is to listen to our citizens, and it has
not resulted in sweeping rejection of administrative rules. It
has, however, resulted in selective rejection of rules,
constructive dialogue with the Executive Branch, and,
ultimately, we believe administrative rules that are more
closely aligned with the intent of the underlying statute.
In order to safeguard the legislature's authority to review
administrative rules, and in light of the close Supreme Court
decision, the legislature chose to put a constitutional
amendment before Idaho voters. The amendment placed the
legislature's authority to review rules in the State's
constitution. Recognizing the good government quality of this
proposed amendment in the 2016 general election, a comfortable
majority of citizens voted in favor of the constitutional
amendment.
In summation, we believe that allowing Executive Branch
agencies the unreviewed authority to promulgate and implement
administrative rules compromises the legislature's authority to
make law and, consequently, strengthens the Executive Branch at
the expense of the Legislative Branch. The passage of the
constitutional amendment strengthened and more clearly defined
the legislature's authority to review and reject Executive
Branch rules. We believe that this is just good government.
Thank you, and I look forward to your questions and our
dialogue.
Senator Lankford. Thank you, Mr. Speaker. Mr. Boschee.
TESTIMONY OF THE HONORABLE JOSHUA A. BOSCHEE,\1\ MEMBER OF THE
HOUSE OF REPRESENTATIVES, LEGISLATIVE ASSEMBLY, STATE OF NORTH
DAKOTA
Mr. Boschee. It is an honor to be with you all this morning
to talk about the administrative rules process in North Dakota
and its relationship with the legislative assembly. As part of
my testimony, I have provided a background memorandum prepared
by our staff that was used as an introductory resource for our
new members this past September. You will find that much of the
technical aspects of my testimony are pulled directly from that
memorandum.
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\1\ The prepared statement of Mr. Boschee appears in the Appendix
on page 34.
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During my time on the Administrative Rules Committee, I
have found the process to be one that is very collaborative
between administrative agencies, the regulated community, the
public, and legislators. North Dakota has a cherished history
of providing access and transparency to our State citizens when
it comes to developing policies at all levels of government and
authority. As part-time legislators who create, amend, and
rescind statutes only 80 days out of each biennium, we rely on
our State agencies to develop the policies and procedures
required to enact the legislative changes made during each
assembly.
Our State agencies, commissions, and regulatory boards are
comprised of employees, elected officials, and appointed
citizens who provide technical expertise and real-world
experiences that inform the rules being developed throughout
the interim. Whether responding to a policy change made by the
assembly, a new Federal regulation, or the dramatically
changing economy North Dakota is experiencing, the
administrative rules process continues to be one that allows
good balance of legislative oversight and professional,
executive independence.
In North Dakota, the Administrative Rules Committee is
appointed, each biennium, with membership of the committee
including at least one of the members who served during the
most recently completed regular session of the assembly from
each of the standing committees from either the House or the
Senate. The committee meets quarterly to review administrative
rules proposed by State agencies, as well as boards and
commissions that have authority to regulate activities within
the State.
The committee is responsible for studying and reviewing
administrative rules and related statutes to determine one of
three things: whether administrative agencies are properly
implementing legislative purpose and intent; whether there is
dissatisfaction with administrative rules or with statutes
relating to administrative rules; or whether there are unclear
or ambiguous statutes relating to administrative rules.
All rule changes, including a creation, amendment, or
repeal, made to implement a statutory change, must be adopted
and filed with legislative councils within 9 months of the
effective date of the statutory change. If an agency needs
additional time for the rule change, a request may be made to
the committee and the committee may extend that time.
Additionally, the committee has the authority to establish
standard procedures for administrative agency compliance,
whether it is notice of requirements for proposed rulemaking,
establishing a procedure to distribute administrative agency
filings, and to receive notice of appeal.
A key component to our State's rulemaking process includes
the Attorneys General (AG) review of agency rules. The AG may
not approve a rule as to legality if the rule exceeds the
statutory authority of the agency or the rule is written in a
manner that is not concise or easily understandable, or
procedural requirements for adopting the rules are not
substantially met.
Agencies have the authority, with approval of the Governor,
to adopt rules on an emergency basis, because of an imminent
peril to public health, safety, or welfare; or because a delay
is likely to cause loss of revenue appropriated to support a
duty imposed upon an agency; or when reasonably necessary to
avoid the delayed in implementing an appropriations measure; or
when necessary to meet a mandate by Federal Government.
An emergency rule may be declared effective no earlier than
the date of filing notice of rulemaking with the legislative
council. An emergency rule becomes ineffective if it is not
adopted as a final rule, through the formal administrative
rules process, within 180 days after its declared effective
date. An agency making emergency rules is required to attempt
to provide notice of the emergency rules to persons the agency
can reasonably be expected to believe may have a substantial
interest in the rules, as well as notification of the Chairman
of the Administrative Rules Committee.
North Dakota's administrative rules process began in 1941,
as the first State to adopt an Administrative Procedure Act
(APA), which was based partly on an earlier tentative draft of
what became the 1946 Model State Administrative Procedure Act
approved by the Commission on Uniform State Laws.
Before 1977, agencies were authorized to adopt
administrative rules, but there was no compilation or central
source of these rules. During the 1977 session, the assembly
enacted statute which requires the legislative council to
compile those rules through a code. Two years later, in 1979,
the legislative assembly enacted statutes providing for
legislative review. And finally, in 1981, the legislative
assembly authorized the committee to make formal objections to
agency rules. If the committee objects to a rule because the
committee determines the rule to be unreasonable, arbitrary,
capricious, or beyond the authority delegated to the adopting
agency, the committee may file the objection in certified form
with the legislative council, with the burden falling upon the
administrative agency to determine whether or not it meets
statutory regulation.
In 1995, the legislative assembly enacted statutory
authority for the committee to void all or any portion of the
administrative rules on any of the following grounds: (a) the
absence of statutory authority; (b) emergency relating to
public health, safety, or welfare; (c) a failure to comply with
express legislative intent or to substantially meet the
procedural requirements of our century code, chapter 28,
regarding the adoption of rules; (d) a conflict with State law;
(e) arbitrariness or capriciousness; and (f) a failure to make
a written record of its consideration or written and oral
submissions respecting the rule during the hearing process and
comment period.
During the 23 years the committee has had the authority to
void rules, only eight rules have been voided.
Based on my experience, when the committee is considering
the action of voiding rules, our practice is that we will table
the section of rule of concern until the next meeting to allow
the agency and any of the concerned public, whether it is
individual citizens or the regulated community, ample time
before the next meeting to come to an amicable agreement. This
is rare and often comes up when the regulated community
impacted by the new rules has strong objections that fall under
one of the previously Stated grounds. It has been my experience
that the agency and concerned stakeholder often find a
resolution to the rules that are then presented to the next
committee meeting.
If the committee finds a rule to be void, the legislative
council has to provide written notice to Legislative
Management. Within 14 days of receipt of the management, the
adopting agency may file a petition with the Chairperson of
Legislative Management for review by our legislative management
for final decision. If the agency does not file a petition, the
rule becomes void on the 15th day after adopting agency
received notice from council. If, within 60 days after receipt
of the petition, the adopting agency and Legislative Management
has not disapproved the finding, the rule is found void.
In 2005, the legislative assembly enacted a bill providing
that except for emergency rules, administrative rules do not
become effective until after they have been reviewed by the
Administrative Rules Committee. And in 2011, a final change was
made that if an agency representative does not appear for a
scheduled meeting, the rules will be held over to the next
meeting.
Since 2015, each adopting agency has been required to
provide proof to the committee with written information
demonstrating that the agency complied with the processes
related to notice of hearing, as well as written statements for
people that objected, either orally or through written form.
Statute does allow the committee to change a rule after
consideration of rules by the committee if the agency and the
committee agree to rule changes is necessary to address any of
the considerations for which the committee may find a rule to
be void. This allows an agency to change an administrative rule
when the committee expresses concern, and in those
circumstances the agency is not required to commence a new
procedure. If a rule change is agreed on by the committee and
the agency, the rule must be reconsidered. If neither party
objects to it, the rule has the opportunity to become effective
as scheduled.
Because the legislative assembly recognized that there are
constitutional questions about the Administrative Rules
Committee voiding rules, an alternative amendment is on the
books which will take effect if the State Supreme Court rules
the authority to void rules is unconstitutional. The
alternative amendment is the same in all respects as the
amendment allowing the committee to void rules but the
alternative, rather, provides an opportunity to suspend the
rules until the next legislative session, for approval by the
legislative assembly.
The Administrative Code, which contains all rules adopted
by agencies, are subject to the Agencies Practices Act. It is
published by the legislative council and has 129 titles. In
North Dakota, 96 of those titles contain rules of
administrative agencies with 16 agencies voluntarily publishing
their rules within our code. The code is distributed free to
each county auditor, to the Supreme Court justices, district
court judges, and certain agencies, as well as can be accessed
online through our legislative website for free by the
citizens.
Based on our nearly 80-year evolution of the administrative
rules process in North Dakota, I am confident that our process
is one that works well for our State. Changes have been made
gradually over time and have been implemented with little
friction between the agencies that are developing the rules and
the legislative assembly. The only concern I have with our
State's process is ensuring that we continue to provide ample
notification and time for citizens to participate in the
process, as subscriptions to print newspapers decline, which is
our formal process of notice, and we become more dependent on
electronic means of official posting.
This concludes my prepared testimony and I am happy to try
and answer any questions the Committee may have.
Senator Lankford. Thank you. Representative O'Neill.
TESTIMONY OF THE HONORABLE ARTHUR O'NEILL,\1\ MEMBER OF THE
HOUSE OF REPRESENTATIVES, GENERAL ASSEMBLY, STATE OF
CONNECTICUT
Mr. O'Neill. Thank you, Mr. Chairman, and good morning
Ranking Member Heitkamp, Chairman, and Members of the
Committee. Thank you for the invitation to testify.
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\1\ The prepared statement of Mr. O'Neill appears in the Appendix
on page 47.
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I am a 27-year veteran of the Legislative Regulations
Review Committee (LRRC) of Connecticut and have previously
served 6 years as co-Chairman of the committee.
The Connecticut General Assembly first began reviewing
regulations in 1945. The Secretary of State was required to
submit to each General Assembly all the regulations promulgated
during the preceding biennium for its study, legislature
meeting only biennially. Any regulation which the General
Assembly disapproved was void and not reissued.
In 1963, the first Regulations Review Committee was
established by statute. This committee was and is a bicameral,
bipartisan committee. It met during the interim between the
sessions and could only disapprove regulations that were
already in effect. This approval voided the regulation unless
the General Assembly overrode the committee's action at its
next session, but the General Assembly was not required to act
on voided regulations.
In 1971, the current Legislative Regulations Review
Committee was created pursuant to the Uniform Administrative
Procedures Act (UAPA), which we adopted. Under the 1971 law,
the committee was authorized to review proposed regulations.
The committee's disapproval of a regulation in 1976 led to a
lawsuit challenging the legislature's role on constitutional
grounds, alleging a breach of the separation of powers
principle. Connecticut Superior Court ruled that the
committee's activity was unconstitutional. The Supreme Court
overturned that lower court decision but they did so on
technical grounds, leaving the issue of constitutionality
unresolved until 1982, when a constitutional amendment,
approved by the electorate, became effective and confirmed the
legislature's authority to consider and disapprove
administrative regulations.
The Regulation Review Committee was established to ensure
proper legislative review of proposed agency regulations.
Administrative regulations have the force of law; therefore,
closer scrutiny and control by the Legislative Branch is
clearly in the public interest to ensure that regulations do
not contravene legislative intent.
The committee, which meets monthly, consists of 14 members,
6 Senators and 8 House members. There are equal numbers of
Republicans and Democrats. There are two co-chairs, a
Republican and a Democrat, one from each chamber. Each term the
co-chairs alternate, so the Senator becomes the member of the
opposite party and the House member does the same thing. This
is a system of subcommittees which usually consists of two
members, a Republican and a Democrat from each chamber.
The subcommittees are assigned to specific agencies. The
subcommittees review, and if necessary, make changes to the
regulations. The regulations and other required documents are
provided to each committee member at least 1 month prior to the
meeting at which the action is to be taken. Legal opinions and
recommendations from our legal staff and fiscal analysis from
our fiscal staff are provided to us 10 days before such
meeting.
The committee can take the following types of action:
approve in whole or in part; approve with technical
corrections; reject without prejudice; or disapprove. Approval
in part allows the committee to make deletions. When deletions
are made, sections or subsections are deleted, not individual
words. The committee cannot add words to a regulation.
Technical changes are sometimes needed to correct spelling,
punctuation, statutory references, and matters of style.
Frequently, regulations are rejected without prejudice for lack
of statutory authority. Rejection without prejudice requires
the agency to resubmit the regulation with appropriate
corrections within either 35 or 65 days, depending on whether
the regulation is mandatory or permissive. There is no limit to
the number of times that a regulation can be rejected without
prejudice.
Disapproval is rare and signifies the committee's
interpretation that the proposed regulation is without
statutory basis. Disapproval requires the regulation to be sent
to an appropriate committee of the legislature for
consideration during the next legislative session. The General
Assembly then has the option to sustain or reverse the
Regulation Review Committee's action. Inaction by the
legislature sustains the action of the committee.
The committee meets as necessary to consider emergency
regulations.
The committee functions as intended. It is effective as a
mechanism to protect the legislative intent from Executive
Branch dilution or distortion. It provides an opportunity for
individuals interested in or affected by a regulation to
influence the process without the time and expense of
litigation. The committee's bipartisan and bicameral structure
enhances its effectiveness.
Some agency staffers who must deal with the Regulations
Review Committee do not want to deal with the committee and the
additional process that we require. I consider that to be
evidence of the effectiveness of the committee in defending the
authority of the Legislative Branch.
And I welcome your questions.
Senator Lankford. Thank you, all three of you.
I will recognize Ranking Member Heitkamp.
Senator Heitkamp. This is always a challenge because there
are two functions, right? There is the oversight function,
which we, as legislators, all believe is absolutely critical,
and there is not any of us who have ever been legislators who
have not said, that is not what we intended. I do not know why
they are doing it that way. I mean, it seemed clear when we
passed it. Why is not it clear to them?
But on the other side is this question of separation of
powers, and whether, in fact, the Legislative Branch, being so
critically involved and so strategically involved in regulatory
analysis and potentially rewrite, that it flips over and
results in a breach of that all-important separation of powers
doctrine that is fundamental to State constitutions,
fundamental to Federal constitutions.
So I want to explore kind of that line, and both of you--
there is two of you who have basically said your States have
confronted constitutional challenges, and the end result was a
constitutional amendment in both cases--correct?--in the case
of Idaho and Connecticut.
Can you just explain to me the various constitutional
provisions you did enact, whether they were tailored very
narrowly or whether it weighed on the side of greater
participation of the legislature in implementation of
legislation, or whether they really just helped clarify what,
in fact, was the oversight responsibility?
And we will start with you, Representative Bedke.
Mr. Bedke. We were very careful in drafting the words in
the constitutional amendment. I kind of glossed over that we
passed it on the second try. What was such old hat for the
legislature, if you will, turned out to be not, so in 2014, the
voters narrowly disapproved the constitutional amendment, but
there was zero explanation there. Like I said, what seemed to
be self-evident to us was obviously not to the general public.
I headed up a statewide campaign to go, to all the
newspapers and all the media statewide, and explain what we
were doing. So we were very careful. We believed that the line
that we did not want to cross was, we could accept or reject,
and when we--and the word says ``in whole or in part,'' but
we--but that ``in part'' mean subsections of the rule.
So we stopped short of amending, we stopped short of the
Meade v. Arnell case, upon which is the Idaho Supreme Court
case which was the basis for all this, was clear, and we
attempted to just codify that ruling and not overreach, because
of all the reasons that you stated earlier. So we were very
careful not to cross that line and we feel like we found the
balance in there.
Now, the Executive Branch, through the Governor, objected
to--came out with a campaign of his own, as did the State
attorney general, saying that the legislature was overreaching.
But we were very careful to delineate that line and not
overstep, and we believe that it has resulted in the dynamic
give-and-take that there needs to be at the State level. When
the regulated public comes into the committee to testify about
how it is affecting them, then their advocates are their
elected officials, not the Executive Branch agency--and I mean
no disparagement to those that work there, but they are not
elected to represent the regulated public.
And so that insertion of having the elected officials usher
that, the regulated public through the rules, which are laws,
we believe holds us accountable as elected officials and gives
the citizens a voice in the process, rather than just passing
vague laws, passing it off to the Executive Branch, and wishing
everybody good luck.
Senator Heitkamp. Representative O'Neill, can you just
explain kind of the constitutional development of your process?
Mr. O'Neill. Sure. As I mentioned, we had a court case,
Maloney v. Pac. The lower court said we were unconstitutional,
what the committee did, and the supreme court overruled it, but
as I said, on technical grounds. So the constitutionality issue
was never really resolved by the supreme court. And so very
shortly after that decision came down is when the
constitutional amendment was passed by the legislature and
voted for by the public.
And what that did was say a couple of things, one of which
was that we clearly had the right to delegate the lawmaking
function if we chose to administrative agencies, and the second
thing was we also have the power to review and, if need be,
reject, disapprove the regulations that were adopted by the
agency.
It was a very short amendment. It was a broad grant of
authority, really, to the legislature to pass laws to implement
that constitutional provision. And so what it really did was, I
believe, and it was intended to do at the time was to ratify
the system that we had already created up until that point and
to allow for its further development because it would be a
clear constitutional basis for the committee to do what it was
doing, and I think that is pretty much what it has done. I did
not really change the way the committee was structured or the
way the committee operated.
Senator Heitkamp. Just legitimized it?
Mr. O'Neill. I am sorry?
Senator Heitkamp. Just legitimized it?
Mr. O'Neill. Just legitimized it.
Senator Heitkamp. I do not want to belabor this but I want
to explain the challenges that we have, because there are
Federal court cases that talk about so-called legislative
vetoes, and whether that is, in fact, in violation of the
continuum of responsibility under separation of powers. And so
we do not have the luxury of a process that is very accessible
for changing our Constitution. And so we have to make sure that
when we are drawing those lines that we are staying well on the
side of legitimate oversight in terms of our legislative
process.
I, as a State agency, had both, as attorney general and as
tax commissioner, spent a fair amount of time in front of the
Administrative Rules Committee, justifying the rules. I think
that having that process--I will tell you honestly--made us
much more conscious of our outreach, much more responsive to
concerns, and maybe even resulted in amendments, because we
knew we were going to have that level of immediate
accountability, not just judicial review but legislative
review. And so I am someone who has seen that process work,
both as an agency head and as somebody who fully participated.
And so with that said, we are trying to figure out how your
lessons, which seem to work really well in your States, how
that can be kind of adapted and adopted here.
One thing I will remarks, it is interesting, in Idaho, I
mean, you are basically a one-party government. I mean, there
is not a very robust second party in Idaho. That is not true of
Connecticut. Obviously, the Governor frequently can be, and is
a Republican. I do not know when the last Democratic Governor
you had, or Democratic Party legislature.
Mr. O'Neill. It was Cecil Andrus, and so it has been a
while, but there--of course, having a large majority party
gives us the luxury of fighting amongst ourselves. And the
Democrats, the minority in Idaho, they are not shrinking
violets, and, if I may, most of our State constitutions--well,
all of our State constitutions, with regard to the Article I
provisions in the United States Constitution, I mean, they read
very similarly. And, arguably, we have not let those Article I
powers erode.
Senator Heitkamp. Except in order to augment those Article
I powers, you had to pass a constitutional amendment which is
the point that I am trying to make, which is you may not have
had, in Connecticut, you had a process, you were continuing
that process under kind of color of authority. You clarified
the authority and in your case, you responded to a critical and
otherwise prohibitive court case. In North Dakota, we have not
had that, in part, I think, because you have not reversed a lot
of rules. And so we are just trying to figure it out.
Representative O'Neill can you talk a little bit--and I
know I am taking up some time, but I know there is not a big--
we are the nerds here. What can I tell you? Can you explain how
you believe that the kind of party balance that you have in
Connecticut affects your ability to do this work or whether you
see challenges?
Mr. O'Neill. Well, as I said, I think the bicameral,
bipartisan nature of the committee helps it, because there is
not the sense that it is one party that--let us say the
majority party also is the majority party on the committee,
would give the sense that this is basically coming from a
partisan perspective. One of the little watch-words, phrases
that we sometimes hear is that the other party is the
opposition; the Executive Branch is the enemy. So we kind of--
and that is spoken by both Republicans and Democrats because we
all have similar experiences in trying to deal with an
Executive Branch agency that is being recalcitrant.
So I think that we have a very partisan system. I mean, we
do things on a very partisan basis in Connecticut. I am
surprised that sometimes when I talk to people from other
States that the partisanship is not as intense. We can be
bipartisan as well. We have institutionalized it in some
places, such as this committee, and it occasionally occurs that
there will be a 7-7 split along party lines, but that is fairly
rare.
And so most of the time the committee speaks with one
voice, it is a unanimous decision, and the Executive Branch,
whether it is the Governor or some commissioner who is trying
to do something, or the treasurer because we review their
regulations as well, and so on, gets the impression, this is
the entity that is speaking on behalf of the legislature, as an
entity.
Senator Heitkamp. Yes. I just want to make this point
before I turn it over. I think some of the hesitation is this
idea that the executive gets elected, different political
party, and then the Legislative Branch, and, therefore, there
is an automatic way that you can limit the ability of the
executive, who is of a different political party, to actually
make decisions that are executive in nature and really
executive.
What is interesting about your process--and we have been
kind of chatting a little bit about it up here--is it really is
about a legislative prerogative versus an executive
prerogative, and building that support for the overreach in the
executive. It is not a political thing. It really is a thing
that challenges the relationship between legislative and
executive, regardless of party.
Mr. O'Neill. Yes. If I could just point out, in the years
that I have been on the committee, we had a Democratic
Governor, Bill O'Neill, when I first got on, Lowell Weicker,
former United States Senator, was Governor as an independent
for 4 years, we had Republicans and then now we have a
Democratic Governor, and the relationship between the committee
and the Executive Branch has been pretty much the same
consistently throughout all those different people, with their
different political perspective and so forth.
Senator Lankford. So I have to ask the question, you said
the relationships have been pretty consistent. Is that
consistently bad or consistently good?
Mr. O'Neill. I would say generally it has mirrored the
relationship that the Governors have had with the legislature,
in general.
Senator Lankford. So if they are contentious about the
legislature, it is a contentious committee as well?
Mr. O'Neill. Correct.
Senator Lankford. Because one of the challenges here in the
conversation is, it is no grand secret to the world that we
have this very adversarial relationship at times with
regulatory bodies here, where a law comes out and then, in our
situation, not uncommon to have a year or 2 or 3 years later
the regulations that mirror up to that law come out, and they
seem to be completely disconnected from the statute itself. And
then you literally have a new legislature, that was not the one
that voted on it. It is now past an election cycle, there is a
new legislature there, and this hostile connection between was
this the intent of Congress? Was this not the intent of
Congress?
So my question for all three of you, if you want to just
give me a quick answer on it, has this process improved the
dialogue between the regulators and the legislature or have you
seen a difference on that, or you all have done it so long you
have not seen a real difference on it?
Mr. O'Neill. I think the dialogue has improved compared to
what it used to be. Before this committee was really activated
in the early 1960s, and even as late as the 1980s, there were a
lot of secret regulations. Regulations were passed. You could
not find them anywhere. The regulation books were years behind,
in terms of publication, and they were very hard to get a hold
of. They were not really even available in law libraries. Now
we have everything online. I mean, that is obviously the
electronic revolution that has facilitated that.
But I think the committee has produced, and embedded into
the process that the Executive Branch deals with, the idea that
they are going to have to explain all of this in public and
answer, and even to the point where agencies will withdraw
regulation--I did not mention that but they can withdraw
regulations up until the very moment we take it up, because
they are afraid that it will get rejected, and that is
considered to be a mark of dishonor, so to speak, within the
agency.
Senator Lankford. That would be very helpful. By the way,
there are secret regulations in the Federal Government as well,
among many, because it is a guidance, where a regulated entity,
a business, whatever it may be, will contact their regulator
and will say, ``I need some advice on this,'' and they will
give them oral counsel on it but will not put it in writing,
and that becomes a big issue as well, because then it depends
on your regulator, what your regulations are.
So I want to complete the two of you to able to ask the
relationship between the regulators and their legislature.
Mr. Boschee. In our State, in North Dakota, very similar to
Idaho, it is a very strong one party across State agencies as
well as within the legislature, and we are more representative
of the fact that there is an equal--there is a proportionate
number of Democrats on the committee as there are Republicans,
based on the elected body.
And so the relationship, I think, is pretty good and has
continued to be good, and part of that, I think, is because as
a legislative body we have implemented the system. We have
created the rules of the administrative rules process. And so
the administrative branch has to follow those rules and if they
step out of line of the rules we have established, then we are
in check there. And we have found great success there.
Additionally, I think it is important to note North
Dakota's legislators, we often see ourselves as citizens first,
legislators second. And so we participate in the administrative
rules process not only as a check but also, during that hearing
process, often you will see in the notes legislators
participating in the field hearings or the hearing information
up front. And so because of that, we are engaged with our
community and the guidelines, and I think the regulators then
get a good feel, especially if it is something, for instance,
that has to do with agriculture community, and there are
legislators who practice agriculture but also represent those
communities, are very involved on the front end, not just
waiting on the back end for it.
Senator Lankford. Speaking as someone who has practiced
agriculture as well as a legislator. Speaker Bedke, do you want
to jump in on this, and talk about their relationships?
Mr. Bedke. Yes, I do. As was said, our system it mirrors
North Dakota's. And so, there is proportional representation on
these committees. These actually are the standing committees
that break themselves out into subcommittees, because all of
the rules are reviewed, and most of them go right through. The
ones that do not come back to the full committee, and based on
the prerogative of the chairman, they will have a hearing.
But as in North Dakota, the legislators are involved in
this negotiated rulemaking that happens out in the field,
because the agencies notice up their meetings, we have to
promulgate some rules here to address this issue, and the local
legislators show up. So they are involved in that process.
We are a part-time legislature as well. We do meet every
year. But, anyway, we are directly involved there.
There is always creative tension, you might say, between
the legislative intent and the Executive Branch. Regardless of
party, regardless of sameness of party, there is always some
creative tension, at best, that can devolve into something
else, at worst. And so it keeps everyone honest, this back and
forth. If the agency overreaches, then there is a self-
governing check that happens in the rules review process. If
the regulated agency is trying to get away with something or
makes assertions that end up to not be true, then there is a
check back on them, and the legislature has the ability to say,
``Yes, regulated industry, that is exactly what we meant, and
we do support this rule.''
So it balances out, and it is a custom and culture in Idaho
to--that says this is true, good faith, negotiated rulemaking,
because of this check and balance, that you have to come back
to the legislature, and if there is anything untoward on either
side of the table, so to speak, then that comes out in the
hearing process, and it is corrected. And so it works well. I
referenced good government. It is just basic good civics. It
involves the elected official in the process. He becomes
accountable to that regulated industry and becomes the advocate
in the process with the Executive Branch, and it makes us write
tighter laws, and then be involved to the final implementation
of the rules out with the regulated public.
Senator Lankford. Yes, accountable all the way to the end.
Senator Carper.
OPENING STATEMENT OF SENATOR CARPER
Senator Carper. Thanks. My first question would be for Mr.
O'Neill. Are you from Connecticut?
Mr. O'Neill. Yes, sir, I am.
Senator Carper. Why do you always have such good women's
basketball teams? Seriously.
Mr. O'Neill. Well, I would have to give a lot of the credit
to the coach, Geno Auriemma, and once you have developed a
great reputation. But there are a lot of good women basketball
players in Connecticut. My daughter was a star at Trinity at
one time.
Senator Carper. No kidding. All right.
On a more serious note, I am a recovering Governor, and had
the opportunity to be Chairman of the National Governors
Association (NGA) at one time, and I used to love to come
before Congress and testify. And because Delaware is so close
by, and I was the Vice Chairman and the Chairman, I got called
on quite a bit. I love to do that. And you know why? Because it
is the issues that they were discussing on most days, I
actually knew more than they did about them. And it was just
very helpful.
And today it is kind of--I am reminded of that situation
because you all know a lot more about this than some of us. And
I have always said that the States can be laboratories of
democracy, and this is a case where you all can really help us
out, and I think help out the country.
I have not read verbatim your testimonies but I am going to
ask each of you to just give me maybe the two most important
points in your testimony so that I can just mull that over, and
then I have a couple of questions. But just give me the two
most important points in each of your testimonies. Mr. Bedke.
Mr. Bedke. Two important points. Number one, we have always
done rules review, at least in recent history, since the late
1960s, it became the custom and culture in Idaho to do that. We
always knew there was a separation of powers issue that we did
not want to cross. We orient new legislators on that because
you will have firebrands that come in and think that they can
come in, that this is the legislature's prerogative to rewrite
the rules. We caution them against the--we remind them of the
Supreme Court precedents that we have nationally as well as at
the State level. And it was ultimately challenged by a then-
Governor.
Senator Carper. Which one?
Mr. Bedke. It was Cecil Andrus in a health and welfare
case. And so the legislature prevailed there, with a 3-2
decision, and that made everybody tighten up our practices for
the ensuing decades. But it was such a good government
practice, as we described earlier, that we thought we should
codify that decision in the State's constitution, and that is
what we ultimately did, and it is working. That is my take-home
message.
Senator Carper. All right.
Mr. Bedke. And I believe, as seems to be the prevailing
sentiment here, that there are some things that the Federal
Government could do that would emulate this process, and it may
iron out some things. Frankly, you all are not passing a lot of
laws. The laws that are----
Senator Carper. I have noticed that. Good thing we do not
get paid this year by all the bills we pass.
Mr. Bedke. So the interaction with the Federal Government
and our Nation's citizens happens at the rules and regulation
and guideline level. And that is an abdication, I believe, of
the legislative branch's power, and we need to balance that
back, and that will have the effect of good government. It does
not predict an outcome but it just ensures a good-faith, good
process.
Senator Carper. All right. Thank you. Mr. Boschee, Joshua,
like in the Bible.
Mr. Boschee. Yes. Thank you, Senator, I think the two most
important aspects of the North Dakota process is that we are
truly a review process. We do have the power to void but in the
23 years we have had that power we have only used it eight
times, and that is really built off of, I think, the process
being one in which we are involved as citizens as legislators,
but then also on the back end, for that final review piece.
I think the second part is our flexibility throughout the
process. We do provide the opportunity that if a rule that has
been proposed and they are out in the field doing hearings and
taking testimony from folks, they are able to augment those
rules a little bit to accommodate those concerns that are
presented, as well as at the committee level, we can help
amend, especially if there are last-minute concerns. If things
have changed in the last 90 days that need to be adapted, we
provide that opportunity throughout our process. We are
responsive and flexible.
Senator Carper. Good. I am going to come back and ask you a
question about why only 8 times in 23 years, but I will get
that in the next round.
Mr. O'Neill, two great takeaway points from you, please.
Mr. O'Neill. Yes, I think that the greatest strength of our
system is that it has been institutionalized so that everyone
accepts it. Our most recent Governor, Governor Malloy, has been
something of an exception. He has tried a couple of times to
undermine or weaken the regulation review process but the
institution, the legislature, has resisted those efforts, and I
think it is accepted regardless of party.
Senator Carper. What is his motivation?
Mr. O'Neill. I think what he was claiming was that he
wanted to streamline the regulation process by eliminating the
review piece, which, of course, would streamline things, and
nobody would know, necessarily, what was going on or be able to
act as a check, which was the whole point of the review.
Senator Carper. Have you talked to him about this?
Mr. O'Neill. Not personally, directly. I have spoken with
his aides that bring us these proposals and things like that,
and they have said, ``Well, because we think it would make
things go more smoothly,'' or because he wants to deregulate a
lot of things and wants to pass deregulatory types of
regulations, repeal things, and when repealers are done we look
at them as well. So that was suggested as the reason why he was
trying to do that.
Senator Carper. In Delaware, when our legislature was in
session, we were in session off and on from January 1 through
June 30th, and they were out for weeks at a time, doing budgets
and stuff like that. But whenever they are in session, in
Dover, if a legislator--House, Senate, Democrat, Republican--
wanted to meet with me, I would meet with them that day. We
would find time.
Mr. O'Neill. Yes. I do not know that Governor Malloy does
that, and, in fact, I----
Senator Carper. You might want to meet with him and say,
``I talked to a recovering Governor from Delaware and he said
this is what he did with his legislators.'' And I will say
this--we had eight great years. It delighted a Republican House
and Democratic Senate, and got along probably as well with the
House as with the Senate. It works.
OK. Go ahead. Your second point?
Mr. O'Neill. In addition to that is that I would say
another strength of ours is that unlike what I am hearing from
the other members of the panel, we reject a lot of regulations.
Now that does not mean that they are dead forever because they
are supposed to bring them back right away and fix them and
correct them. We disapprove, which is really kill the
regulation forever, very rarely, once every 4 or 5 years. So we
do have an ongoing dialogue after we reject the regulation,
with the agency. That is when we really get into a dialogue
with the agency.
If we look at what they have done and say, ``You got it
wrong and here is why we think it is wrong. Sit down and work
with us, or, more importantly, have your lawyers talk to our
lawyers and work out the details,'' and that is when we, I
think, are able to resolve conflicts and give the public a real
opportunity to weigh in on those challenged ones, is when we
have that dialogue of sometimes rejecting them two or three
times before we get final approval.
Senator Carper. Thank you. Now, Joshua, I mentioned that I
was going to come back and ask you about 8 times in 23 years
you actually voided regulations. Why so few? That is a
surprisingly low number.
Mr. Boschee. Senator, one of our practices on the committee
is often if it comes to the review process to us and there are
contentions between the regulated community and the agency, we
often will table the rule for the quarter, and that is
basically a shot across the bow to the regulators, saying,
figure this out with the regulated community so we do not void
these on you, and oftentimes it has been resolved and it is
amicable. They show up at the next meeting and say, ``We have
kumbaya-ed. We have figured it out and we would appreciate you
all to approve what we have changed.'' So, again, that
flexibility that we allow. They do not have to re-notice. They
do not have to re-hear. If they make that change, that is
amicable, and we do not have to be in a contentious situation.
It will then be reviewed at that point.
Senator Carper. OK. Could I just ask one more? Do you mind?
Senator Lankford. Yes, you can.
Senator Carper. One says yes. The other says no. The
Democrat said no. I am a Democrat. That is bipartisan.
Do you have a lookback, generally--one of the things Barack
Obama did when he was President, as my colleagues will recall,
is he asked, I think it was Cass Sunstein, who was the head of
the Office of Information and Regulatory Affairs (OIRA) in the
Office of Management and Budget (OMB), asked him to do a
regular lookback, and just look back at our existing
regulations and see which ones would I keep, which ones we have
to get rid of. And we got rid of, quite a few over time. Do you
all have that policy in your State, Mr. O'Neill?
Mr. O'Neill. Yes. We actually started doing that about 20
years ago. We passed legislation that required all of the
agencies to review all of their regulations. We had a schedule
of them to come in and report to us and tell us which ones
ought to be removed from the books, and that worked well the
first time we did it because there was a strong impetus to do
it.
They were supposed to come in on a 5-year rolling schedule
to keep on doing this, and that has not worked out. So what we
recently did was we shifted the responsibility for handling
that from the Regulation Review Committee to the substantive
committee. So a transportation regulation would be brought over
to the Transportation Committee for them to decide, because
they have a more regular contact with an agency to decide about
those kinds of things. So this is new. We have not really seen
how it works. We just changed the law last year. But after the
first go-around, it just never seemed to get off the ground
again, to keep going with that regularly scheduled review.
Senator Carper. That makes sense. OK.
Mr. Boschee. For us, Senator, we have not wholesalely--or
wholesaled the process such as Connecticut. But generally, what
we find is that when an agency brings forward something to do
with a section of code and they want to update, or something is
not relevant anymore, they will update it at that time and that
is part of the process.
Senator Carper. I see. Thank you. And Scott.
Mr. Bedke. I think that the fact that we, maybe, North
Dakota and Idaho, reject so few rules, and maybe we do more
than they do, but I think that this involvement and this
process that we are used to that has happened for decades
preempts some of the problems. And so it has this leveling
effect because no one tries to gain the system at the advantage
of the other party. And so I think that we preemptively solve a
lot of the problems because everyone knows that they are going
to have to stand tall in front of the legislature, whether it
is the regulated community or the agency, and justify their
actions, and that has the effect of creating better behavior on
both sides.
In Idaho, we were able to also look back--everything--every
rule is fair game. So the ones that are pending, if they become
permanent, then we are--and there becomes a problem that
everyone missed, then we are able to pull those back and review
those again. But it prompts a negotiated rulemaking afterwards,
and while we are in session, of course, they cannot promulgate
a rule, but as soon as we leave then there becomes another
temporary rule and they try to employ the lessons that they
have just learned, or the new information that has just come
forward.
So I think the involvement preempts problems, and thus we
have fewer rules rejected, because we have been doing it for a
while and we have kind of found our own level.
Senator Carper. Great. Well, we have lot of folks who come
and testify before us but this is an extraordinary panel, and
we--some nice common-sense, practical, just really good advice,
and straight talk. We appreciate that, and I hope you enjoy
your stay here and you will come back and help us with other
problems. All right? We will put you on retainer.
Senator Heitkamp. I have a quick question. Have any of your
States looked at judicial review and whether there had been a
reversal of a lot of rules before your process, and whether, in
fact, there has been a decline, and probably maybe even an
elimination of judicial reversal of regulations as a result of
this process?
Mr. Bedke. That is an interesting question, Senator, and I
can have the research done, but I do not have a straight answer
for you at this point.
Senator Heitkamp. Off the top of your head, do you have any
recollection at all of a recent censure process, since the
constitutional process went into effect, of the court voiding
any rule that came through this process?
Mr. Bedke. Keep in mind we only elevated this to the
constitution last November----
Senator Heitkamp. OK.
Mr. Bedke [continuing]. And so we have not had a challenge
yet. But I believe that new legislators are going to have to be
careful with the wording that we use, and if we begin amending
rules----
Senator Heitkamp. You are in trouble.
Mr. Bedke [continuing]. Rather than just accepting or
rejecting, I believe--and I am not a lawyer, and forgive me for
bragging---- [Laughter.]
I believe that there is a line out there over which we
should not cross, but we have not been challenged yet. Of
course, that were some of the assertions in the campaign
leading up to the constitutional amendment, that this was going
to be challenged and whatnot, but the opponents could not come
up with a scenario that was not addressed in our process. Now,
my friend from North Dakota has gone into great length in the
technical aspects of your State's process. We have a similar
technical way that we do it all. And so the opponents that
debated me, during the campaign leading up to this, we were
able to go into depth and to allay those concerns in a way that
allowed the process, or the measure, to pass with nearly 60
percent of the vote.
Senator Heitkamp. Yes. I think one of the points that I am
trying to make is that listening to you all, we are worried
about whether you are usurping executive authority, but you are
almost acting like a first judicial review of the regulation.
And so where we have focused on this separation of powers, a
lot of what you are doing is what you would expect a court to
do on the front end. And I am just wondering if you see a
reduction in the number of regulations that have been voided by
the court because you have gone through this process.
Senator Lankford. Let me add one thing to that and I
definitely want to hear this answer. The court has the
responsibility in law to define what the law says. You are
actually saying, no, this is what the law says and you are not
following it as a regulation. So that is why we are jumping
into this. We have lots of follow-up questions on this issue at
Judicial Review, but let us keep going.
Mr. O'Neill. We have been at it so long it is hard to tell,
in terms of challenges, other than the Pac decision where it
was voided, or the committee already was challenged as
unconstitutional at the lower-case court and then later on was
not, but that case was overturned but not resolved.
We do not get a lot of court cases, as far as I can tell. I
certainly could go through and see. We can try and do a
comparison. Things were so different in the way people would be
able to go to court and challenge things, back in the 60s, I
would say, for regulations, before this committee really got
rolling in the 70s. It would be hard to do a comparison.
I do know that periodically, so people do still challenge
our regulations--we will hear, because we are told, we have to
subpoena all the records from the review committee's
proceedings to bring to the court because they are challenging
a regulation on the grounds that something is being done,
either inconsistent with that the committee told them to do and
what the regulation was rewritten to say, or they are claiming
somehow that there was something wrong with what the committee
did. But that does not happen on a, as far as I can tell, a
very regular basis. My impression is that most issues that
would provoke a court action are resolved at the committee
level. It is certainly one of the things I think of as strong
points of this process is that you can avoid unnecessary
litigation because you have someone on the bureaucracy side who
simply will not listen.
So that is my impression. We do not get a lot but we still
do get some.
Senator Lankford. OK.
Mr. Boschee. And my recollection is, we have not had too
many court cases, judicial cases, related to this. But what I
have seen, and I would have to think of an example--I cannot do
it off the top of my head right now--is that advocates for a
judicial change may go to an agency and say, ``Can we make a
change through the administrative rules process?''
Senator Lankford. Say that again.
Mr. Boschee. Where advocates of a change--so instead of
taking----
Senator Lankford. So an outside citizen group.
Mr. Boschee. Right.
Senator Lankford. OK.
Mr. Boschee. Or a business entity group, regulated
community would go to the agency and say, ``Instead of us doing
this, can we come to compromise through the administrative
rules process?'' And, again, we have not had a constitutional
challenge so that is unique, I think, compared to my colleagues
here.
Senator Lankford. Fine. I am still back in the same
position. I am trying to figure out the process here, because,
again, we see the animus. We are trying to figure out what is a
legal process. What other States have done as they have walked
through this.
Several years ago, the House of Representatives was
frustrated with the President--and I can fill in the blanks on
this--basically not applying the law as they saw that had been
written and done. And so they went to the court. The court,
actually, for the first time, went to the President and said,
no, the President does not have the constitutional authority to
be able to do this. Here is what the law says. And, literally,
the House of Representatives was suing the Executive Branch to
go through that.
That case is now determined. It is a famous case now
dealing with the Affordable Care Act. But that is a case where
the House is actually filing a suit against the actions of the
President. What I am trying to figure out is, is that the
natural connection point here, where at the Judicial Branch,
which really says what the law says, steps into a regulation
and says that regulation is not consistent with that group? And
the reason it comes up so often here is, by the time the
regulation is promulgated, it is a different Legislative
Branch.
You are saying it is already so with you all as well, that
the promulgation of the rule and the finalizing of the rule, it
is a new legislative group after an election that is actually
going back and reviewing it. That has been the contentious
point. It is not the same people writing it, literally. It is
the same body but not the same people writing it, also saying
this is what we meant or did not mean by it. Does that make
sense?
Mr. Bedke. It does, and I believe that in--but because of
the practice back at the State levels that we have described
here, there are fewer aggrieved parties. And so going to the
court for redress or relief is, that relief has been granted in
the process that led up to the writing of the rule. And, so I
do not presume to understand all the ins and outs of here, but
you have, available to you, the Congressional Review Act (CRA)
that you have employed----
Senator Lankford [continuing]. As recently as this week.
Mr. Bedke. That is right. And so that allows by concurrent
resolution or--but the President has to sign that. Now we do
not have that. The Executive Branch does not have to sign off
on these. Many States have the ability. As we were doing our
research for this constitutional amendment, there are many
States that have rules where you process but they have to do
that rules review with a bill that is passed as both bodies,
and then is signed into effect by the Governor.
And, I will use the phrase that is the ``fox guarding the
henhouse'' to a point, very lightly. I mean no disparagement.
But that would seem to violate the separation of powers on the
other side of the issue. It is the legislature's prerogative to
make the laws, executive carries them out, the judiciary--this
is basic civics, and that is why I believe that if works so
well. And, over time, if it is allowed to work, then you
preempt a lot of problems.
Senator Lankford. But that is the challenge of the
Congressional Review Act, is that it does require Presidential
signature, and often you have an Executive Branch creating a
regulation that the Legislative Branch may say, no, that is not
consistent with the law, but you have to go get approval from
the people that wrote it the first time.
Mr. Bedke. That is my use of the term ``the fox guarding
the henhouse.''
Senator Lankford. Yes. No, I picked up the nuance there on
that, but that is also why it has only been used 15 times in
the history of the Congressional Review Act, and it has always
been with the transition of the White House.
Mr. Bedke. And, if I may, the political stars have to line
up so that the President is of the same party----
Senator Lankford. Right.
Mr. Bedke [continuing]. As the--you get it.
Senator Lankford. I do. So the retrospective, or going back
and looking at old regulations as well, for all three of your
States, you could look at any regulation, at whatever year, at
whatever time. Is that correct, or is there a time limiting
that you can only review it for the first year, or once it is
promulgated or finalized? Do you have the ability to be able to
look at any regulation at any time?
Mr. Bedke. We do. In Idaho we do.
Senator Lankford. OK.
Mr. Boschee. I believe we do. I will double-check and get
back to you.
Senator Lankford. Representative O'Neill?
Mr. O'Neill. The committee cannot initiate that process
other than through this legislation that we have that requires
the agencies to periodically report. As I said, we just changed
that. The committee gets regulations before they go into
effect, but they do not go into effect unless the committee
approves them or lets them go through----
Senator Lankford. So your committee has the ability--they
propose the rule, go through the final language, the committee
has the conversation. Before it ever goes into effect it has to
be signed off by your committee.
Mr. O'Neill. That is correct.
Senator Lankford. OK. Same for both of you as well? It
cannot go into effect until it has a signature?
Mr. Bedke. For Idaho, it is after the fact. All of the
rules that are promulgated come back to the legislature, and if
there is a rule that is in the archives or is not a pending
rule for that year, then an individual legislator drafts the
concurrent resolution, brings that to the committee, and then
the committee has the prerogative to go back. Certainly the
ones that are permanent rules--well, nothing is permanent----
Senator Lankford. I have noticed.
Mr. Bedke [continuing]. But there is a greater buffer of
protection, if you will, from the legislature there than there
is. But an individual legislator can draft a resolution, bring
that to the committee. If the chair agrees then it proceeds.
Senator Lankford. OK. Go ahead, Representative Boschee.
Mr. Boschee. I was going to say, we do not sign off as part
of our review. The committee only would vote on the review if
we have made a language change as part of the process. So if we
amend it to make it more friendly to the regulated community,
or if something happened in the last 30 days that we need to
also make part of this rule, then we would, as a legislative
action of the committee, change it.
Senator Lankford. But you could change text, add text to
the regulation.
Mr. Boschee. Correct.
Senator Lankford. Both of you are basically saying you are
not adding many words. You could delete words or get rid of it
entirely.
Mr. Bedke. That is correct, Senator.
Mr. O'Neill. That is right. We cannot add a word.
Senator Lankford. OK. This is extremely helpful. Let me ask
one last question on that. I would be very interested in
anything else you want to contribute to the record, here, to be
able to get in.
My one last question is, is there a State that you would
recommend that we also look at, based on your own research and
your own interaction with other States, to say they also--we do
not do it exactly like they do but I think you should look at
that State and how they do it?
Mr. Bedke. Senator, right off the top of my head I cannot
think of other States, other than Connecticut, which is what we
looked at a lot in the lead-up to ours. You will find that many
States have a similar process, maybe, in the low 20s, and then
there will be the rest of the States, in the high 20s, that
have the insertion of the Governor in the process, I believe.
Senator Lankford. The fox in the henhouse conversation.
Mr. Boschee. I am sorry. I am not able to provide any other
States.
Senator Lankford. OK. There is no State better than North
Dakota, is what you are saying.
Mr. Boschee. Correct.
Senator Lankford. OK. I get it.
Mr. O'Neill. Well, I am always told that Connecticut has
sort of been the creator of the most advanced system in this.
Senator Lankford. You have had a lot time to be able to
develop this system.
Mr. O'Neill. Yes.
Senator Lankford. OK. Gentleman, I appreciate it very much.
What I would ask of you is as you have other ideas and thoughts
on it, feel free to be able to share that with me or with our
staff, because we continue to be able to gather these ideas.
This has been an issue that plagues us, because of the
number of regulations that we have and the number of agencies
that are creating them, and the difficulty of the checks and
balances. The Office of Management and Budget process was
created to try to help Congress manage that, though it is in
the Executive Branch, but we are still in the same mode of
trying to figure out how to be able to manage that and how to
be able to get back to, Speaker Bedke, as you mentioned as
well, the person that is elected being held accountable when
the final regulation is done.
My only thought is, is there a moment when the Executive
Branch has to challenge the Legislative Branch, that when you
see--let us say a bill is passed, the regulation is done, the
legislature looks at it and says, ``That is too onerous. That
is too overreaching,'' and their response is, ``That is what
the law says. This is the only way to do what you asked us to
do,'' that the Legislative Branch has to come back and say,
``You are right. There is not another way to do it. We
stretched it that we have to pass something new.''
Has that happened to you all, where there has been a
challenge to be able to step back and say, ``We have to fix the
statute because we asked them, the regulators, to do something
that will be so expensive or so onerous that we are going to
have to pull back the statute.'' That becomes, again, a
judicial question where the judiciary can step in and say,
``No, that is what the law really says.''
Mr. Bedke. Senator, that has a ring of familiarity to me. I
do not have the specifics but I believe that we have done a
double-take. This return and report that is baked into this
process gives pause both to, I am sure has given pause to the
legislature in Idaho before, and then have gone back through
the regular process and addressed the underlying issue in the
law. And, not that we admit to mistakes on the legislature
side----
Senator Lankford. Of course not.
Mr. Bedke [continuing]. But maybe things happen, and,
anyway, we go, ``Oh, I can see--''
Senator Lankford. I would tell you I have had some
colleagues that voted for the Dodd-Frank proposal when it came
out, and after the regulations started being promulgated they
said, ``I did not realize it would mean that.'' And so there is
some push and pull on it.
Mr. Bedke. Naturally, and that should precipitate a law
change.
Senator Lankford. Right. Any thoughts on that?
Mr. O'Neill. Yes. We actually have one of those cases
pending right now. We had a legislation that called upon, I
believe, public health and the Department of Environmental
Protection to develop some regulations jointly. They created
the regulations and then each of the commissioners wrote us a
letter saying that these are terrible regulations but we are
doing what you asked us to do, and if you look at the
consequences of imposing these kinds of regulations you are
going to be jeopardizing public health, because it changes a
lot of things about allowing people to sell foods that have not
been properly tested, and that sort of thing.
Clearly, somebody had an idea, it went through the process,
and it did not get carefully enough reviewed before it became
statutory law. And so what we have done, in the committee--and
this may be an example of us stretching--said we are going to
reject it, even though it does what the law says, we are
rejecting it without prejudice, and do not bring it back until
after the legislature has had a chance to sit down and review
all of this again. So this does create that kind of an
opportunity for the agency to have a second go at the
legislative process and say, ``Did you really mean to do
that?'' And we now have concluded no, we really did not.
Senator Lankford. That is extremely helpful.
Gentlemen, thank you again. Let us keep the dialogue going
as we try to work this out. At some point, when we finally get
it all resolved, you will be able to tell your grandchildren
``I fixed that,'' and was a part of helping getting that
resolved. So I appreciate it very much.
Any final comments? Anything that needs to get on the
record?
Mr. Bedke. And let us tell our children, not our
grandchildren.
Senator Lankford. Yes. I would be very good with that. Any
other final comments?
Mr. Boschee. Thank you for the opportunity.
Senator Lankford. Thank you. Thank you all for being here.
I will make a final statement and announce the next
hearing. Today's hearing is concluded. The hearing record will
remain open for 15 days until the close of business on November
the 10th, for the submissions of statements and questions for
the record.
This hearing is adjourned.
[Whereupon, at 11:24 a.m., the Subcommittee was adjourned.]
A P P E N D I X
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