[Congressional Record Volume 141, Number 46 (Monday, March 13, 1995)]
[House]
[Pages H3053-H3065]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]


    CONFERENCE REPORT ON S. 1, UNFUNDED MANDATES REFORM ACT OF 1995

  Mr. CLINGER submitted the following conference report and statement 
on the Senate bill (S. 1) to curb the practice of imposing unfunded 
Federal mandates on States and local governments; to strengthen the 
partnership between the Federal Government and State, local, and tribal 
governments; to end the imposition, in the absence of full 
consideration by Congress, of Federal mandates on State, local, and 
tribal governments without adequate funding, in a manner that may 
displace other essential governmental priorities; and to ensure that 
the Federal Government pays the costs incurred by those governments in 
complying with certain requirements under Federal statutes and 
regulations; and for other purposes:

                  Conference Report (H. Rept. 104-76)
       The committee of conference on the disagreeing votes of the 
     two Houses on the amendment of the House to the bill (S. 1), 
     to curb the practice of imposing unfunded Federal mandates on 
     States and local governments; to strengthen the partnership 
     between the Federal Government and State, local and tribal 
     governments; to end the imposition, in the absence of full 
     consideration by Congress, of Federal mandates on State, 
     local, and tribal governments without adequate funding, in a 
     manner that may displace other essential governmental 
     priorities; and to ensure that the Federal Government pays 
     the costs incurred by those governments in complying with 
     certain requirements under Federal statutes and regulations; 
     and for other purposes, having met, after full and free 
     conference, have agreed to recommend and do recommend to 
     their respective Houses as follows:
       That the Senate recede from its disagreement to the 
     amendment of the House and agree to the same with an 
     amendment as follows:
       In lieu of the matter proposed to be inserted by the House 
     amendment, insert the following:
     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Unfunded Mandates Reform Act 
     of 1995''.

     SEC. 2. PURPOSES.

       The purposes of this Act are--
       (1) to strengthen the partnership between the Federal 
     Government and State, local, and tribal governments;
       (2) to end the imposition, in the absence of full 
     consideration by Congress, of Federal mandates on State, 
     local, and tribal governments without adequate Federal 
     funding, in a manner that may displace other essential State, 
     local, and tribal governmental priorities;
       (3) to assist Congress in its consideration of proposed 
     legislation establishing or revising Federal programs 
     containing Federal mandates affecting State, local, and 
     tribal governments, and the private sector by--
       (A) providing for the development of information about the 
     nature and size of mandates in proposed legislation; and
       (B) establishing a mechanism to bring such information to 
     the attention of the Senate and the House of Representatives 
     before the Senate and the House of Representatives vote on 
     proposed legislation;
       (4) to promote informed and deliberate decisions by 
     Congress on the appropriateness of Federal mandates in any 
     particular instance;
       (5) to require that Congress consider whether to provide 
     funding to assist State, local, and tribal governments in 
     complying with Federal mandates, to require analyses of the 
     impact of private sector mandates, and through the 
     dissemination of that information provide informed and 
     deliberate decisions by Congress and Federal agencies and 
     retain competitive balance between the public and private 
     sectors;
       (6) to establish a point-of-order vote on the consideration 
     in the Senate and House of Representatives of legislation 
     containing significant Federal intergovernmental mandates 
     without providing adequate funding to comply with such 
     mandates;
       (7) to assist Federal agencies in their consideration of 
     proposed regulations affecting State, local, and tribal 
     governments, by--
       (A) requiring that Federal agencies develop a process to 
     enable the elected and other officials of State, local, and 
     tribal governments to provide input when Federal agencies are 
     developing regulations; and
       (B) requiring that Federal agencies prepare and consider 
     estimates of the budgetary impact of regulations containing 
     Federal mandates upon State, local, and tribal governments 
     and the private sector before adopting such regulations, and 
     ensuring that small governments are given special 
     consideration in that process; and
       (8) to begin consideration of the effect of previously 
     imposed Federal mandates, including the impact on State, 
     local, and tribal governments of Federal court 
     interpretations of Federal statutes and regulations that 
     impose Federal intergovernmental mandates.

     SEC. 3. DEFINITIONS.

       For purposes of this Act--
       (1) except as provided in section 305 of this Act, the 
     terms defined under section 421 of the Congressional Budget 
     and Impoundment Control Act of 1974 (as added by section 101 
     of this Act) shall have the meanings as so defined; and
       (2) the term ``Director'' means the Director of the 
     Congressional Budget Office.
     SEC. 4. EXCLUSIONS.

       This Act shall not apply to any provision in a bill, joint 
     resolution, amendment, motion, or conference report before 
     Congress and any provision in a proposed or final Federal 
     regulation that--
       (1) enforces constitutional rights of individuals;
       (2) establishes or enforces any statutory rights that 
     prohibit discrimination on the basis of race, color, 
     religion, sex, national origin, age, handicap, or disability;
       (3) requires compliance with accounting and auditing 
     procedures with respect to grants or other money or property 
     provided by the Federal Government;
       (4) provides for emergency assistance or relief at the 
     request of any State, local, or tribal government or any 
     official of a State, local, or tribal government;
       (5) is necessary for the national security or the 
     ratification or implementation of international treaty 
     obligations;
       (6) the President designates as emergency legislation and 
     that the Congress so designates in statute; or
       (7) relates to the old-age, survivors, and disability 
     insurance program under title II of the Social Security Act 
     (including taxes imposed by sections 3101(a) and 3111(a) of 
     the Internal Revenue Code of 1986 (relating to old-age, 
     survivors, and disability insurance)).

     SEC. 5. AGENCY ASSISTANCE.

       Each agency shall provide to the Director such information 
     and assistance as the Director may reasonably request to 
     assist the Director in carrying out this Act.
             TITLE I--LEGISLATIVE ACCOUNTABILITY AND REFORM

     SEC. 101. LEGISLATIVE MANDATE ACCOUNTABILITY AND REFORM.

       (a) In General.--Title IV of the Congressional Budget and 
     Impoundment Control Act of 1974 is amended by--
       (1) inserting before section 401 the following:

                  ``Part A--General Provisions''; and

       (2) adding at the end thereof the following new part:

                       ``Part B--Federal Mandates

     ``SEC. 421. DEFINITIONS.

       ``For purposes of this part:
       ``(1) Agency.--The term `agency' has the same meaning as 
     defined in section 551(1) of title 5, United States Code, but 
     does not include independent regulatory agencies.
       ``(2) Amount.--The term `amount', with respect to an 
     authorization of appropriations for Federal financial 
     assistance, means the amount of budget authority for any 
     Federal grant assistance program or any Federal program 
     providing loan guarantees or direct loans.
       ``(3) Direct costs.--The term `direct costs'--
       ``(A)(i) in the case of a Federal intergovernmental 
     mandate, means the aggregate estimated amounts that all 
     State, local, and tribal governments would be required to 
     spend or would be prohibited from raising in revenues in 
     order to comply with the Federal intergovernmental mandate; 
     or
       ``(ii) in the case of a provision referred to in paragraph 
     (5)(A)(ii), means the amount of Federal financial assistance 
     eliminated or reduced;
       ``(B) in the case of a Federal private sector mandate, 
     means the aggregate estimated amounts that the private sector 
     will be required to spend in order to comply with the Federal 
     private sector mandate;
       ``(C) shall be determined on the assumption that--
       ``(i) State, local, and tribal governments, and the private 
     sector will take all reasonable steps necessary to mitigate 
     the costs resulting from the Federal mandate, and will comply 
     with applicable standards of practice and conduct established 
     by recognized professional or trade associations; and
       ``(ii) reasonable steps to mitigate the costs shall not 
     include increases in State, local, or tribal taxes or fees; 
     and
       ``(D) shall not include--
       ``(i) estimated amounts that the State, local, and tribal 
     governments (in the case of a Federal intergovernmental 
     mandate) or the private sector (in the case of a Federal 
     private sector mandate) would spend--

       ``(I) to comply with or carry out all applicable Federal, 
     State, local, and tribal laws and regulations in effect at 
     the time of the adoption of the Federal mandate for the same 
     activity as is affected by that Federal mandate; or
       ``(II) to comply with or carry out State, local, and tribal 
     governmental programs, or private-sector business or other 
     activities in effect at the time of the adoption of the 
     Federal mandate for the same activity as is affected by that 
     mandate; or

       ``(ii) expenditures to the extent that such expenditures 
     will be offset by any direct savings to the State, local, and 
     tribal governments, or by the private sector, as a result 
     of--

       ``(I) compliance with the Federal mandate; or
       ``(II) other changes in Federal law or regulation that are 
     enacted or adopted in the same bill or joint resolution or 
     proposed or final Federal regulation and that govern the same 
     activity as is affected by the Federal mandate.

       ``(4) Direct savings.--The term `direct savings', when used 
     with respect to the result of compliance with the Federal 
     mandate--
       ``(A) in the case of a Federal intergovernmental mandate, 
     means the aggregate estimated 
     [[Page H3054]] reduction in costs to any State, local, or 
     tribal government as a result of compliance with the Federal 
     intergovernmental mandate; and
       ``(B) in the case of a Federal private sector mandate, 
     means the aggregate estimated reduction in costs to the 
     private sector as a result of compliance with the Federal 
     private sector mandate.
       ``(5) Federal intergovernmental mandate.--The term `Federal 
     intergovernmental mandate' means--
       ``(A) any provision in legislation, statute, or regulation 
     that--
       ``(i) would impose an enforceable duty upon State, local, 
     or tribal governments, except--

       ``(I) a condition of Federal assistance; or
       ``(II) a duty arising from participation in a voluntary 
     Federal program, except as provided in subparagraph (B)); or

       ``(ii) would reduce or eliminate the amount of 
     authorization of appropriations for--

       ``(I) Federal financial assistance that would be provided 
     to State, local, or tribal governments for the purpose of 
     complying with any such previously imposed duty unless such 
     duty is reduced or eliminated by a corresponding amount; or
       ``(II) the control of borders by the Federal Government; or 
     reimbursement to State, local, or tribal governments for the 
     net cost associated with illegal, deportable, and excludable 
     aliens, including court-mandated expenses related to 
     emergency health care, education or criminal justice; when 
     such a reduction or elimination would result in increased net 
     costs to State, local, or tribal governments in providing 
     education or emergency health care to, or incarceration of, 
     illegal aliens; except that this subclause shall not be in 
     effect with respect to a State, local, or tribal government, 
     to the extent that such government has not fully cooperated 
     in the efforts of the Federal Government to locate, 
     apprehend, and deport illegal aliens;

       ``(B) any provision in legislation, statute, or regulation 
     that relates to a then-existing Federal program under which 
     $500,000,000 or more is provided annually to State, local, 
     and tribal governments under entitlement authority, if the 
     provision--
       ``(i)(I) would increase the stringency of conditions of 
     assistance to State, local, or tribal governments under the 
     program; or
       ``(II) would place caps upon, or otherwise decrease, the 
     Federal Government's responsibility to provide funding to 
     State, local, or tribal governments under the program; and
       ``(ii) the State, local, or tribal governments that 
     participate in the Federal program lack authority under that 
     program to amend their financial or programmatic 
     responsibilities to continue providing required services that 
     are affected by the legislation, statute, or regulation.
       ``(6) Federal mandate.--The term `Federal mandate' means a 
     Federal intergovernmental mandate or a Federal private sector 
     mandate, as defined in paragraphs (5) and (7).
       ``(7) Federal private sector mandate.--The term `Federal 
     private sector mandate' means any provision in legislation, 
     statute, or regulation that--
       ``(A) would impose an enforceable duty upon the private 
     sector except--
       ``(i) a condition of Federal assistance; or
       ``(ii) a duty arising from participation in a voluntary 
     Federal program; or
       ``(B) would reduce or eliminate the amount of authorization 
     of appropriations for Federal financial assistance that will 
     be provided to the private sector for the purposes of 
     ensuring compliance with such duty.
       ``(8) Local government.--The term `local government' has 
     the same meaning as defined in section 6501(6) of title 31, 
     United States Code.
       ``(9) Private sector.--The term `private sector' means all 
     persons or entities in the United States, including 
     individuals, partnerships, associations, corporations, and 
     educational and nonprofit institutions, but shall not include 
     State, local, or tribal governments.
       ``(10) Regulation; rule.--The term `regulation' or `rule' 
     (except with respect to a rule of either House of the 
     Congress) has the meaning of `rule' as defined in section 
     601(2) of title 5, United States Code.
       ``(11) Small government.--The term `small government' means 
     any small governmental jurisdictions defined in section 
     601(5) of title 5, United States Code, and any tribal 
     government.
       ``(12) State.--The term `State' has the same meaning as 
     defined in section 6501(9) of title 31, United States Code.
       ``(13) Tribal government.--The term `tribal government' 
     means any Indian tribe, band, nation, or other organized 
     group or community, including any Alaska Native village or 
     regional or village corporation as defined in or established 
     pursuant to the Alaska Native Claims Settlement Act (85 Stat. 
     688; 43 U.S.C. 1601 et seq.) which is recognized as eligible 
     for the special programs and services provided by the United 
     States to Indians because of their special status as Indians.
     ``SEC. 422. EXCLUSIONS.

       ``This part shall not apply to any provision in a bill, 
     joint resolution, amendment, motion, or conference report 
     before Congress that--
       ``(1) enforces constitutional rights of individuals;
       ``(2) establishes or enforces any statutory rights that 
     prohibit discrimination on the basis of race, color, 
     religion, sex, national origin, age, handicap, or disability;
       ``(3) requires compliance with accounting and auditing 
     procedures with respect to grants or other money or property 
     provided by the Federal Government;
       ``(4) provides for emergency assistance or relief at the 
     request of any State, local, or tribal government or any 
     official of a State, local, or tribal government;
       ``(5) is necessary for the national security or the 
     ratification or implementation of international treaty 
     obligations;
       ``(6) the President designates as emergency legislation and 
     that the Congress so designates in statute; or
       ``(7) relates to the old-age, survivors, and disability 
     insurance program under title II of the Social Security Act 
     (including taxes imposed by sections 3101(a) and 3111(a) of 
     the Internal Revenue Code of 1986 (relating to old-age, 
     survivors, and disability insurance)).
     ``SEC. 423. DUTIES OF CONGRESSIONAL COMMITTEES.

       ``(a) In General.--When a committee of authorization of the 
     Senate or the House of Representatives reports a bill or 
     joint resolution of public character that includes any 
     Federal mandate, the report of the committee accompanying the 
     bill or joint resolution shall contain the information 
     required by subsections (c) and (d).
       ``(b) Submission of Bills to the Director.--When a 
     committee of authorization of the Senate or the House of 
     Representatives orders reported a bill or joint resolution of 
     a public character, the committee shall promptly provide the 
     bill or joint resolution to the Director of the Congressional 
     Budget Office and shall identify to the Director any Federal 
     mandates contained in the bill or resolution.
       ``(c) Reports on Federal Mandates.--Each report described 
     under subsection (a) shall contain--
       ``(1) an identification and description of any Federal 
     mandates in the bill or joint resolution, including the 
     direct costs to State, local, and tribal governments, and to 
     the private sector, required to comply with the Federal 
     mandates;
       ``(2) a qualitative, and if practicable, a quantitative 
     assessment of costs and benefits anticipated from the Federal 
     mandates (including the effects on health and safety and the 
     protection of the natural environment); and
       ``(3) a statement of the degree to which a Federal mandate 
     affects both the public and private sectors and the extent to 
     which Federal payment of public sector costs or the 
     modification or termination of the Federal mandate as 
     provided under section 425(a)(2) would affect the competitive 
     balance between State, local, or tribal governments and the 
     private sector including a description of the actions, if 
     any, taken by the committee to avoid any adverse impact on 
     the private sector or the competitive balance between the 
     public sector and the private sector.
       ``(d) Intergovernmental Mandates.--If any of the Federal 
     mandates in the bill or joint resolution are Federal 
     intergovernmental mandates, the report required under 
     subsection (a) shall also contain--
       ``(1)(A) a statement of the amount, if any, of increase or 
     decrease in authorization of appropriations under existing 
     Federal financial assistance programs, or of authorization of 
     appropriations for new Federal financial assistance, provided 
     by the bill or joint resolution and usable for activities of 
     State, local, or tribal governments subject to the Federal 
     intergovernmental mandates;
       ``(B) a statement of whether the committee intends that the 
     Federal intergovernmental mandates be partly or entirely 
     unfunded, and if so, the reasons for that intention; and
       ``(C) if funded in whole or in part, a statement of whether 
     and how the committee has created a mechanism to allocate the 
     funding in a manner that is reasonably consistent with the 
     expected direct costs among and between the respective levels 
     of State, local, and tribal government; and
       ``(2) any existing sources of Federal assistance in 
     addition to those identified in paragraph (1) that may assist 
     State, local, and tribal governments in meeting the direct 
     costs of the Federal intergovernmental mandates.
       ``(e) Preemption Clarification and Information.--When a 
     committee of authorization of the Senate or the House of 
     Representatives reports a bill or joint resolution of public 
     character, the committee report accompanying the bill or 
     joint resolution shall contain, if relevant to the bill or 
     joint resolution, an explicit statement on the extent to 
     which the bill or joint resolution is intended to preempt any 
     State, local, or tribal law, and, if so, an explanation of 
     the effect of such preemption.
       ``(f) Publication of Statement From the Director.--
       ``(1) In general.--Upon receiving a statement from the 
     Director under section 424, a committee of the Senate or the 
     House of Representatives shall publish the statement in the 
     committee report accompanying the bill or joint resolution to 
     which the statement relates if the statement is available at 
     the time the report is printed.
       ``(2) Other publication of statement of director.--If the 
     statement is not published in the report, or if the bill or 
     joint resolution to which the statement relates is expected 
     to be considered by the Senate or the House of 
     Representatives before the report is published, the committee 
     shall cause the statement, or a summary thereof, to be 
     published in the Congressional Record in advance of floor 
     consideration of the bill or joint resolution.

     ``SEC. 424. DUTIES OF THE DIRECTOR; STATEMENTS ON BILLS AND 
                   JOINT RESOLUTIONS OTHER THAN APPROPRIATIONS 
                   BILLS AND JOINT RESOLUTIONS.

       ``(a) Federal Intergovernmental Mandates in Reported Bills 
     and Resolutions.--For each bill or joint resolution of a 
     public character reported by any committee of authorization 
     of the Senate or the House of Representatives, the Director 
     of the Congressional Budget Office shall prepare and submit 
     to the committee a statement as follows:
       ``(1) Contents.--If the Director estimates that the direct 
     cost of all Federal intergovernmental mandates in the bill or 
     joint resolution will equal or exceed $50,000,000 (adjusted 
     annually for inflation) in the fiscal year in which any 
     Federal intergovernmental mandate in the bill 
     [[Page H3055]] or joint resolution (or in any necessary 
     implementing regulation) would first be effective or in any 
     of the 4 fiscal years following such fiscal year, the 
     Director shall so state, specify the estimate, and briefly 
     explain the basis of the estimate.
       ``(2) Estimates.--Estimates required under paragraph (1) 
     shall include estimates (and brief explanations of the basis 
     of the estimates) of--
       ``(A) the total amount of direct cost of complying with the 
     Federal intergovernmental mandates in the bill or joint 
     resolution;
       ``(B) if the bill or resolution contains an authorization 
     of appropriations under section 425(a)(2)(B), the amount of 
     new budget authority for each fiscal year for a period not to 
     exceed 10 years beyond the effective date necessary for the 
     direct cost of the intergovernmental mandate; and
       ``(C) the amount, if any, of increase in authorization of 
     appropriations under existing Federal financial assistance 
     programs, or of authorization of appropriations for new 
     Federal financial assistance, provided by the bill or joint 
     resolution and usable by State, local, or tribal governments 
     for activities subject to the Federal intergovernmental 
     mandates.
       ``(3) Estimate not feasible.--If the Director determines 
     that it is not feasible to make a reasonable estimate that 
     would be required under paragraphs (1) and (2), the Director 
     shall not make the estimate, but shall report in the 
     statement that the reasonable estimate cannot be made and 
     shall include the reasons for that determination in the 
     statement. If such determination is made by the Director, a 
     point of order under this part shall lie only under section 
     425(a)(1) and as if the requirement of section 425(a)(1) had 
     not been met.
       ``(b) Federal Private Sector Mandates in Reported Bills and 
     Joint Resolutions.--For each bill or joint resolution of a 
     public character reported by any committee of authorization 
     of the Senate or the House of Representatives, the Director 
     of the Congressional Budget Office shall prepare and submit 
     to the committee a statement as follows:
       ``(1) Contents.--If the Director estimates that the direct 
     cost of all Federal private sector mandates in the bill or 
     joint resolution will equal or exceed $100,000,000 (adjusted 
     annually for inflation) in the fiscal year in which any 
     Federal private sector mandate in the bill or joint 
     resolution (or in any necessary implementing regulation) 
     would first be effective or in any of the 4 fiscal years 
     following such fiscal year, the Director shall so state, 
     specify the estimate, and briefly explain the basis of the 
     estimate.
       ``(2) Estimates.--Estimates required under paragraph (1) 
     shall include estimates (and a brief explanation of the basis 
     of the estimates) of--
       ``(A) the total amount of direct costs of complying with 
     the Federal private sector mandates in the bill or joint 
     resolution; and
       ``(B) the amount, if any, of increase in authorization of 
     appropriations under existing Federal financial assistance 
     programs, or of authorization of appropriations for new 
     Federal financial assistance, provided by the bill or joint 
     resolution usable by the private sector for the activities 
     subject to the Federal private sector mandates.
       ``(3) Estimate not feasible.--If the Director determines 
     that it is not feasible to make a reasonable estimate that 
     would be required under paragraphs (1) and (2), the Director 
     shall not make the estimate, but shall report in the 
     statement that the reasonable estimate cannot be made and 
     shall include the reasons for that determination in the 
     statement.
       ``(c) Legislation Falling Below the Direct Costs 
     Thresholds.--If the Director estimates that the direct costs 
     of a Federal mandate will not equal or exceed the thresholds 
     specified in subsections (a) and (b), the Director shall so 
     state and shall briefly explain the basis of the estimate.
       ``(d) Amended Bills and Joint Resolutions; Conference 
     Reports.--If a bill or joint resolution is passed in an 
     amended form (including if passed by one House as an 
     amendment in the nature of a substitute for the text of a 
     bill or joint resolution from the other House) or is reported 
     by a committee of conference in amended form, and the amended 
     form contains a Federal mandate not previously considered by 
     either House or which contains an increase in the direct cost 
     of a previously considered Federal mandate, then the 
     committee of conference shall ensure, to the greatest extent 
     practicable, that the Director shall prepare a statement as 
     provided in this subsection or a supplemental statement for 
     the bill or joint resolution in that amended form.

     ``SEC. 425. LEGISLATION SUBJECT TO POINT OF ORDER.

       ``(a) In General.--It shall not be in order in the Senate 
     or the House of Representatives to consider--
       ``(1) any bill or joint resolution that is reported by a 
     committee unless the committee has published a statement of 
     the Director on the direct costs of Federal mandates in 
     accordance with section 423(f) before such consideration, 
     except this paragraph shall not apply to any supplemental 
     statement prepared by the Director under section 424(d); and
       ``(2) any bill, joint resolution, amendment, motion, or 
     conference report that would increase the direct costs of 
     Federal intergovernmental mandates by an amount that causes 
     the thresholds specified in section 424(a)(1) to be exceeded, 
     unless--
       ``(A) the bill, joint resolution, amendment, motion, or 
     conference report provides new budget authority or new 
     entitlement authority in the House of Representatives or 
     direct spending authority in the Senate for each fiscal year 
     for such mandates included in the bill, joint resolution, 
     amendment, motion, or conference report in an amount equal to 
     or exceeding the direct costs of such mandate; or
       ``(B) the bill, joint resolution, amendment, motion, or 
     conference report includes an authorization for 
     appropriations in an amount equal to or exceeding the direct 
     costs of such mandate, and--
       ``(i) identifies a specific dollar amount of the direct 
     costs of such mandate for each year up to 10 years during 
     which such mandate shall be in effect under the bill, joint 
     resolution, amendment, motion or conference report, and such 
     estimate is consistent with the estimate determined under 
     subsection (e) for each fiscal year;
       ``(ii) identifies any appropriation bill that is expected 
     to provide for Federal funding of the direct cost referred to 
     under clause (i); and
       ``(iii)(I) provides that for any fiscal year the 
     responsible Federal agency shall determine whether there are 
     insufficient appropriations for that fiscal year to provide 
     for the direct costs under clause (i) of such mandate, and 
     shall (no later than 30 days after the beginning of the 
     fiscal year) notify the appropriate authorizing committees of 
     Congress of the determination and submit either--

       ``(aa) a statement that the agency has determined, based on 
     a re-estimate of the direct costs of such mandate, after 
     consultation with State, local, and tribal governments, that 
     the amount appropriated is sufficient to pay for the direct 
     costs of such mandate; or
       ``(bb) legislative recommendations for either implementing 
     a less costly mandate or making such mandate ineffective for 
     the fiscal year;

       ``(II) provides for expedited procedures for the 
     consideration of the statement or legislative recommendations 
     referred to in subclause (I) by Congress no later than 30 
     days after the statement or recommendations are submitted to 
     Congress; and
       ``(III) provides that such mandate shall--

       ``(aa) in the case of a statement referred to in subclause 
     (I)(aa), cease to be effective 60 days after the statement is 
     submitted unless Congress has approved the agency's 
     determination by joint resolution during the 60-day period;
       ``(bb) cease to be effective 60 days after the date the 
     legislative recommendations of the responsible Federal agency 
     are submitted to Congress under subclause (I)(bb) unless 
     Congress provides otherwise by law; or
       ``(cc) in the case that such mandate that has not yet taken 
     effect, continue not to be effective unless Congress provides 
     otherwise by law.

       ``(b) Rule of Construction.--The provisions of subsection 
     (a)(2)(B)(iii) shall not be construed to prohibit or 
     otherwise restrict a State, local, or tribal government from 
     voluntarily electing to remain subject to the original 
     Federal intergovernmental mandate, complying with the 
     programmatic or financial responsibilities of the original 
     Federal intergovernmental mandate and providing the funding 
     necessary consistent with the costs of Federal agency 
     assistance, monitoring, and enforcement.
       ``(c) Committee on Appropriations.--
       ``(1) Application.--The provisions of subsection (a)--
       ``(A) shall not apply to any bill or resolution reported by 
     the Committee on Appropriations of the Senate or the House of 
     Representatives; except
       ``(B) shall apply to--
       ``(i) any legislative provision increasing direct costs of 
     a Federal intergovernmental mandate contained in any bill or 
     resolution reported by the Committee on Appropriations of the 
     Senate or House of Representatives;
       ``(ii) any legislative provision increasing direct costs of 
     a Federal intergovernmental mandate contained in any 
     amendment offered to a bill or resolution reported by the 
     Committee on Appropriations of the Senate or House of 
     Representatives;
       ``(iii) any legislative provision increasing direct costs 
     of a Federal intergovernmental mandate in a conference report 
     accompanying a bill or resolution reported by the Committee 
     on Appropriations of the Senate or House of Representatives; 
     and
       ``(iv) any legislative provision increasing direct costs of 
     a Federal intergovernmental mandate contained in any 
     amendments in disagreement between the two Houses to any bill 
     or resolution reported by the Committee on Appropriations of 
     the Senate or House of Representatives.
       ``(2) Certain provisions stricken in senate.--Upon a point 
     of order being made by any Senator against any provision 
     listed in paragraph (1)(B), and the point of order being 
     sustained by the Chair, such specific provision shall be 
     deemed stricken from the bill, resolution, amendment, 
     amendment in disagreement, or conference report and may not 
     be offered as an amendment from the floor.
       ``(d) Determinations of Applicability to Pending 
     Legislation.--For purposes of this section, in the Senate, 
     the presiding officer of the Senate shall consult with the 
     Committee on Governmental Affairs, to the extent practicable, 
     on questions concerning the applicability of this part to a 
     pending bill, joint resolution, amendment, motion, or 
     conference report.
       ``(e) Determinations of Federal Mandate Levels.--For 
     purposes of this section, in the Senate, the levels of 
     Federal mandates for a fiscal year shall be determined based 
     on the estimates made by the Committee on the Budget.

     ``SEC. 426. PROVISIONS RELATING TO THE HOUSE OF 
                   REPRESENTATIVES.

       ``(a) Enforcement in the House of Representatives.--It 
     shall not be in order in the House of Representatives to 
     consider a rule or order that waives the application of 
     section 425.
       ``(b) Disposition of Points of Order.--
       ``(1) Application to the house of representatives.--This 
     subsection shall apply only to the House of Representatives.
       ``(2) Threshold burden.--In order to be cognizable by the 
     Chair, a point of order under section 425 or subsection (a) 
     of this section must specify the precise language on which it 
     is premised.
     [[Page H3056]]   ``(3) Question of consideration.--As 
     disposition of points of order under section 425 or 
     subsection (a) of this section, the Chair shall put the 
     question of consideration with respect to the proposition 
     that is the subject of the points of order.
       ``(4) Debate and intervening motions.--A question of 
     consideration under this section shall be debatable for 10 
     minutes by each Member initiating a point of order and for 10 
     minutes by an opponent on each point of order, but shall 
     otherwise be decided without intervening motion except one 
     that the House adjourn or that the Committee of the Whole 
     rise, as the case may be.
       ``(5) Effect on amendment in order as original text.--The 
     disposition of the question of consideration under this 
     subsection with respect to a bill or joint resolution shall 
     be considered also to determine the question of consideration 
     under this subsection with respect to an amendment made in 
     order as original text.

     ``SEC. 427. REQUESTS TO THE CONGRESSIONAL BUDGET OFFICE FROM 
                   SENATORS.

       ``At the written request of a Senator, the Director shall, 
     to the extent practicable, prepare an estimate of the direct 
     costs of a Federal intergovernmental mandate contained in an 
     amendment of such Senator.

     ``SEC. 428. CLARIFICATION OF APPLICATION.

       ``(a) In General.--This part applies to any bill, joint 
     resolution, amendment, motion, or conference report that 
     reauthorizes appropriations, or that amends existing 
     authorizations of appropriations, to carry out any statute, 
     or that otherwise amends any statute, only if enactment of 
     the bill, joint resolution, amendment, motion, or conference 
     report--
       ``(1) would result in a net reduction in or elimination of 
     authorization of appropriations for Federal financial 
     assistance that would be provided to State, local, or tribal 
     governments for use for the purpose of complying with any 
     Federal intergovernmental mandate, or to the private sector 
     for use to comply with any Federal private sector mandate, 
     and would not eliminate or reduce duties established by the 
     Federal mandate by a corresponding amount; or
       ``(2) would result in a net increase in the aggregate 
     amount of direct costs of Federal intergovernmental mandates 
     or Federal private sector mandates other than as described in 
     paragraph (1).
       ``(b) Direct Costs.--
       ``(1) In general.--For purposes of this part, the direct 
     cost of the Federal mandates in a bill, joint resolution, 
     amendment, motion, or conference report that reauthorizes 
     appropriations, or that amends existing authorizations of 
     appropriations, to carry out a statute, or that otherwise 
     amends any statute, means the net increase, resulting from 
     enactment of the bill, joint resolution, amendment, motion, 
     or conference report, in the amount described under paragraph 
     (2)(A) over the amount described under paragraph (2)(B).
       ``(2) Amounts.--The amounts referred to under paragraph (1) 
     are--
       ``(A) the aggregate amount of direct costs of Federal 
     mandates that would result under the statute if the bill, 
     joint resolution, amendment, motion, or conference report is 
     enacted; and
       ``(B) the aggregate amount of direct costs of Federal 
     mandates that would result under the statute if the bill, 
     joint resolution, amendment, motion, or conference report 
     were not enacted.
       ``(3) Extension of authorization of appropriations.--For 
     purposes of this section, in the case of legislation to 
     extend authorization of appropriations, the authorization 
     level that would be provided by the extension shall be 
     compared to the authorization level for the last year in 
     which authorization of appropriations is already provided.''.
       (b) Technical and Conforming Amendments.--Section 1(b) of 
     the Congressional Budget and Impoundment Control Act of 1974 
     is amended--
       (1) by inserting ``Part A--General Provisions'' before the 
     item relating to section 401; and
       (2) by inserting after the item relating to section 407 the 
     following:

                       ``Part B--Federal Mandates

``Sec. 421. Definitions.
``Sec. 422. Exclusions.
``Sec. 423. Duties of congressional committees.
``Sec. 424. Duties of the Director; statements on bills and joint 
              resolutions other than appropriations bills and joint 
              resolutions.
``Sec. 425. Legislation subject to point of order.
``Sec. 426. Provisions relating to the House of Representatives.
``Sec. 427. Requests to the Congressional Budget Office from Senators.
``Sec. 428. Clarification of application.''.
     SEC. 102. ASSISTANCE TO COMMITTEES AND STUDIES.

       The Congressional Budget and Impoundment Control Act of 
     1974 is amended--
       (1) in section 202--
       (A) in subsection (c)--
       (i) by redesignating paragraph (2) as paragraph (3); and
       (ii) by inserting after paragraph (1) the following new 
     paragraph:
       ``(2) At the request of any committee of the Senate or the 
     House of Representatives, the Office shall, to the extent 
     practicable, consult with and assist such committee in 
     analyzing the budgetary or financial impact of any proposed 
     legislation that may have--
       ``(A) a significant budgetary impact on State, local, or 
     tribal governments;
       ``(B) a significant financial impact on the private sector; 
     or
       ``(C) a significant employment impact on the private 
     sector.''; and
       (B) by amending subsection (h) to read as follows:
       ``(h) Studies.--
       ``(1) Continuing studies.--The Director of the 
     Congressional Budget Office shall conduct continuing studies 
     to enhance comparisons of budget outlays, credit authority, 
     and tax expenditures.
       ``(2) Federal mandate studies.--
       ``(A) At the request of any Chairman or ranking member of 
     the minority of a Committee of the Senate or the House of 
     Representatives, the Director shall, to the extent 
     practicable, conduct a study of a legislative proposal 
     containing a Federal mandate.
       ``(B) In conducting a study on intergovernmental mandates 
     under subparagraph (A), the Director shall--
       ``(i) solicit and consider information or comments from 
     elected officials (including their designated 
     representatives) of State, local, or tribal governments as 
     may provide helpful information or comments;
       ``(ii) consider establishing advisory panels of elected 
     officials or their designated representatives, of State, 
     local, or tribal governments if the Director determines that 
     such advisory panels would be helpful in performing 
     responsibilities of the Director under this section; and
       ``(iii) if, and to the extent that the Director determines 
     that accurate estimates are reasonably feasible, include 
     estimates of--

       ``(I) the future direct cost of the Federal mandate to the 
     extent that such costs significantly differ from or extend 
     beyond the 5-year period after the mandate is first 
     effective; and
       ``(II) any disproportionate budgetary effects of Federal 
     mandates upon particular industries or sectors of the 
     economy, States, regions, and urban or rural or other types 
     of communities, as appropriate.

       ``(C) In conducting a study on private sector mandates 
     under subparagraph (A), the Director shall provide estimates, 
     if and to the extent that the Director determines that such 
     estimates are reasonably feasible, of--
       ``(i) future costs of Federal private sector mandates to 
     the extent that such mandates differ significantly from or 
     extend beyond the 5-year time period referred to in 
     subparagraph (B)(iii)(I);
       ``(ii) any disproportionate financial effects of Federal 
     private sector mandates and of any Federal financial 
     assistance in the bill or joint resolution upon any 
     particular industries or sectors of the economy, States, 
     regions, and urban or rural or other types of communities; 
     and
       ``(iii) the effect of Federal private sector mandates in 
     the bill or joint resolution on the national economy, 
     including the effect on productivity, economic growth, full 
     employment, creation of productive jobs, and international 
     competitiveness of United States goods and services.''; and
       (2) in section 301(d) by adding at the end thereof the 
     following new sentence: ``Any Committee of the House of 
     Representatives or the Senate that anticipates that the 
     committee will consider any proposed legislation 
     establishing, amending, or reauthorizing any Federal program 
     likely to have a significant budgetary impact on any State, 
     local, or tribal government, or likely to have a significant 
     financial impact on the private sector, including any 
     legislative proposal submitted by the executive branch likely 
     to have such a budgetary or financial impact, shall include 
     its views and estimates on that proposal to the Committee on 
     the Budget of the applicable House.''.

     SEC. 103. COST OF REGULATIONS.

       (a) Sense of the Congress.--It is the sense of the Congress 
     that Federal agencies should review and evaluate planned 
     regulations to ensure that the cost estimates provided by the 
     Congressional Budget Office will be carefully considered as 
     regulations are promulgated.
       (b) Statement of Cost.--At the request of a committee 
     chairman or ranking minority member, the Director shall, to 
     the extent practicable, prepare a comparison between--
       (1) an estimate by the relevant agency, prepared under 
     section 202 of this Act, of the costs of regulations 
     implementing an Act containing a Federal mandate; and
       (2) the cost estimate prepared by the Congressional Budget 
     Office for such Act when it was enacted by the Congress.
       (c) Cooperation of Office of Management and Budget.--At the 
     request of the Director of the Congressional Budget Office, 
     the Director of the Office of Management and Budget shall 
     provide data and cost estimates for regulations implementing 
     an Act containing a Federal mandate covered by part B of 
     title IV of the Congressional Budget and Impoundment Control 
     Act of 1974 (as added by section 101 of this Act).

     SEC. 104. REPEAL OF CERTAIN ANALYSIS BY CONGRESSIONAL BUDGET 
                   OFFICE.

       Section 403 of the Congressional Budget and Impoundment 
     Control Act of 1974 is amended--
       (1) in subsection (a)--
       (A) by striking out paragraph (2);
       (B) in paragraph (3) by striking out ``paragraphs (1) and 
     (2)'' and inserting in lieu thereof ``paragraph (1)''; and
       (C) by redesignating paragraphs (3) and (4) as paragraphs 
     (2) and (3), respectively;
       (2) by striking out ``(a)''; and
       (3) by striking out subsections (b) and (c).

     SEC. 105. CONSIDERATION FOR FEDERAL FUNDING.

       Nothing in this Act shall preclude a State, local, or 
     tribal government that already complies with all or part of 
     the Federal intergovernmental mandates included in the bill, 
     joint resolution, amendment, motion, or conference report 
     from consideration for Federal funding under section 
     425(a)(2) of the Congressional Budget and Impoundment Control 
     Act of 1974 (as added by section 101 of this Act) for the 
     cost of the mandate, including the costs the State, local, or 
     tribal government is currently paying and any additional 
     costs necessary to meet the mandate.

[[Page H3057]]

     SEC. 106. IMPACT ON LOCAL GOVERNMENTS.

       (a) Findings.--The Senate finds that--
       (1) the Congress should be concerned about shifting costs 
     from Federal to State and local authorities and should be 
     equally concerned about the growing tendency of States to 
     shift costs to local governments;
       (2) cost shifting from States to local governments has, in 
     many instances, forced local governments to raise property 
     taxes or curtail sometimes essential services; and
       (3) increases in local property taxes and cuts in essential 
     services threaten the ability of many citizens to attain and 
     maintain the American dream of owning a home in a safe, 
     secure community.
       (b) Sense of the Senate.--It is the sense of the Senate 
     that--
       (1) the Federal Government should not shift certain costs 
     to the State, and States should end the practice of shifting 
     costs to local governments, which forces many local 
     governments to increase property taxes;
       (2) States should end the imposition, in the absence of 
     full consideration by their legislatures, of State issued 
     mandates on local governments without adequate State funding, 
     in a manner that may displace other essential government 
     priorities; and
       (3) one primary objective of this Act and other efforts to 
     change the relationship among Federal, State, and local 
     governments should be to reduce taxes and spending at all 
     levels and to end the practice of shifting costs from one 
     level of government to another with little or no benefit to 
     taxpayers.

     SEC. 107. ENFORCEMENT IN THE HOUSE OF REPRESENTATIVES.

       (a) Motions To Strike in the Committee of the Whole.--
     Clause 5 of rule XXIII of the Rules of the House of 
     Representatives is amended by adding at the end the 
     following:
       ``(c) In the consideration of any measure for amendment in 
     the Committee of the Whole containing any Federal mandate the 
     direct costs of which exceed the threshold in section 
     424(a)(1) of the Unfunded Mandate Reform Act of 1995, it 
     shall always be in order, unless specifically waived by terms 
     of a rule governing consideration of that measure, to move to 
     strike such Federal mandate from the portion of the bill then 
     open to amendment.''.
       (b) Committee on Rules Reports on Waived Points of Order.--
     The Committee on Rules shall include in the report required 
     by clause 1(d) of rule XI (relating to its activities during 
     the Congress) of the Rules of the House of Representatives a 
     separate item identifying all waivers of points of order 
     relating to Federal mandates, listed by bill or joint 
     resolution number and the subject matter of that measure.

     SEC. 108. EXERCISE OF RULEMAKING POWERS.

       The provisions of sections 101 and 107 are enacted by 
     Congress--
       (1) as an exercise of the rulemaking power of the Senate 
     and the House of Representatives, respectively, and as such 
     they shall be considered as part of the rules of such House, 
     respectively, and such rules shall supersede other rules only 
     to the extent that they are inconsistent therewith; and
       (2) with full recognition of the constitutional right of 
     either House to change such rules (so far as relating to such 
     House) at any time, in the same manner, and to the same 
     extent as in the case of any other rule of each House.

     SEC. 109. AUTHORIZATION OF APPROPRIATIONS.

       There are authorized to be appropriated to the 
     Congressional Budget Office $4,500,000 for each of the fiscal 
     years 1996, 1997, 1998, 1999, 2000, 2001, and 2002 to carry 
     out the provisions of this title.

     SEC. 110. EFFECTIVE DATE.

       This title shall take effect on January 1, 1996 or on the 
     date 90 days after appropriations are made available as 
     authorized under section 109, whichever is earlier and shall 
     apply to legislation considered on and after such date.
             TITLE II--REGULATORY ACCOUNTABILITY AND REFORM

     SEC. 201. REGULATORY PROCESS.

       Each agency shall, unless otherwise prohibited by law, 
     assess the effects of Federal regulatory actions on State, 
     local, and tribal governments, and the private sector (other 
     than to the extent that such regulations incorporate 
     requirements specifically set forth in law).

     SEC. 202. STATEMENTS TO ACCOMPANY SIGNIFICANT REGULATORY 
                   ACTIONS.

       (a) In General.--Unless otherwise prohibited by law, before 
     promulgating any general notice of proposed rulemaking that 
     is likely to result in promulgation of any rule that includes 
     any Federal mandate that may result in the expenditure by 
     State, local, and tribal governments, in the aggregate, or by 
     the private sector, of $100,000,000 or more (adjusted 
     annually for inflation) in any 1 year, and before 
     promulgating any final rule for which a general notice of 
     proposed rulemaking was published, the agency shall prepare a 
     written statement containing--
       (1) an identification of the provision of Federal law under 
     which the rule is being promulgated;
       (2) a qualitative and quantitative assessment of the 
     anticipated costs and benefits of the Federal mandate, 
     including the costs and benefits to State, local, and tribal 
     governments or the private sector, as well as the effect of 
     the Federal mandate on health, safety, and the natural 
     environment and such an assessment shall include--
       (A) an analysis of the extent to which such costs to State, 
     local, and tribal governments may be paid with Federal 
     financial assistance (or otherwise paid for by the Federal 
     Government); and
       (B) the extent to which there are available Federal 
     resources to carry out the intergovernmental mandate;
       (3) estimates by the agency, if and to the extent that the 
     agency determines that accurate estimates are reasonably 
     feasible, of--
       (A) the future compliance costs of the Federal mandate; and
       (B) any disproportionate budgetary effects of the Federal 
     mandate upon any particular regions of the nation or 
     particular State, local, or tribal governments, urban or 
     rural or other types of communities, or particular segments 
     of the private sector;
       (4) estimates by the agency of the effect on the national 
     economy, such as the effect on productivity, economic growth, 
     full employment, creation of productive jobs, and 
     international competitiveness of United States goods and 
     services, if and to the extent that the agency in its sole 
     discretion determines that accurate estimates are reasonably 
     feasible and that such effect is relevant and material; and
       (5)(A) a description of the extent of the agency's prior 
     consultation with elected representatives (under section 204) 
     of the affected State, local, and tribal governments;
       (B) a summary of the comments and concerns that were 
     presented by State, local, or tribal governments either 
     orally or in writing to the agency; and
       (C) a summary of the agency's evaluation of those comments 
     and concerns.
       (b) Promulgation.--In promulgating a general notice of 
     proposed rulemaking or a final rule for which a statement 
     under subsection (a) is required, the agency shall include in 
     the promulgation a summary of the information contained in 
     the statement.
       (c) Preparation in Conjunction With Other Statement.--Any 
     agency may prepare any statement required under subsection 
     (a) in conjunction with or as a part of any other statement 
     or analysis, provided that the statement or analysis 
     satisfies the provisions of subsection (a).

     SEC. 203. SMALL GOVERNMENT AGENCY PLAN.

       (a) Effects on Small Governments.--Before establishing any 
     regulatory requirements that might significantly or uniquely 
     affect small governments, agencies shall have developed a 
     plan under which the agency shall--
       (1) provide notice of the requirements to potentially 
     affected small governments, if any;
       (2) enable officials of affected small governments to 
     provide meaningful and timely input in the development of 
     regulatory proposals containing significant Federal 
     intergovernmental mandates; and
       (3) inform, educate, and advise small governments on 
     compliance with the requirements.
       (b) Authorization of Appropriations.--There are authorized 
     to be appropriated to each agency to carry out the provisions 
     of this section and for no other purpose, such sums as are 
     necessary.

     SEC. 204. STATE, LOCAL, AND TRIBAL GOVERNMENT INPUT.

       (a) In General.--Each agency shall, to the extent permitted 
     in law, develop an effective process to permit elected 
     officers of State, local, and tribal governments (or their 
     designated employees with authority to act on their behalf) 
     to provide meaningful and timely input in the development of 
     regulatory proposals containing significant Federal 
     intergovernmental mandates.
       (b) Meetings Between State, Local, Tribal and Federal 
     Officers.--The Federal Advisory Committee Act (5 U.S.C. App.) 
     shall not apply to actions in support of intergovernmental 
     communications where--
       (1) meetings are held exclusively between Federal officials 
     and elected officers of State, local, and tribal governments 
     (or their designated employees with authority to act on their 
     behalf) acting in their official capacities; and
       (2) such meetings are solely for the purposes of exchanging 
     views, information, or advice relating to the management or 
     implementation of Federal programs established pursuant to 
     public law that explicitly or inherently share 
     intergovernmental responsibilities or administration.
       (c) Implementing Guidelines.--No later than 6 months after 
     the date of enactment of this Act, the President shall issue 
     guidelines and instructions to Federal agencies for 
     appropriate implementation of subsections (a) and (b) 
     consistent with applicable laws and regulations.

     SEC. 205. LEAST BURDENSOME OPTION OR EXPLANATION REQUIRED.

       (a) In General.--Except as provided in subsection (b), 
     before promulgating any rule for which a written statement is 
     required under section 202, the agency shall identify and 
     consider a reasonable number of regulatory alternatives and 
     from those alternatives select the least costly, most cost-
     effective or least burdensome alternative that achieves the 
     objectives of the rule, for--
       (1) State, local, and tribal governments, in the case of a 
     rule containing a Federal intergovernmental mandate; and
       (2) the private sector, in the case of a rule containing a 
     Federal private sector mandate.
       (b) Exception.--The provisions of subsection (a) shall 
     apply unless--
       (1) the head of the affected agency publishes with the 
     final rule an explanation of why the least costly, most cost-
     effective or least burdensome method of achieving the 
     objectives of the rule was not adopted; or
       (2) the provisions are inconsistent with law.
       (c) OMB Certification.--No later than 1 year after the date 
     of the enactment of this Act, the Director of the Office of 
     Management and Budget shall certify to Congress, with a 
     written explanation, agency compliance with this section and 
     include in that certification agencies and rulemakings that 
     fail to adequately comply with this section.

     SEC. 206. ASSISTANCE TO THE CONGRESSIONAL BUDGET OFFICE.

       The Director of the Office of Management and Budget shall--
       (1) collect from agencies the statements prepared under 
     section 202; and
     [[Page H3058]]   (2) periodically forward copies of such 
     statements to the Director of the Congressional Budget Office 
     on a reasonably timely basis after promulgation of the 
     general notice of proposed rulemaking or of the final rule 
     for which the statement was prepared.
     SEC. 207. PILOT PROGRAM ON SMALL GOVERNMENT FLEXIBILITY.

       (a) In General.--The Director of the Office of Management 
     and Budget, in consultation with Federal agencies, shall 
     establish pilot programs in at least 2 agencies to test 
     innovative, and more flexible regulatory approaches that--
       (1) reduce reporting and compliance burdens on small 
     governments; and
       (2) meet overall statutory goals and objectives.
       (b) Program Focus.--The pilot programs shall focus on rules 
     in effect or proposed rules, or a combination thereof.

     SEC. 208. ANNUAL STATEMENTS TO CONGRESS ON AGENCY COMPLIANCE.

       No later than 1 year after the effective date of this title 
     and annually thereafter, the Director of the Office of 
     Management and Budget shall submit to the Congress, including 
     the Committee on Governmental Affairs of the Senate and the 
     Committee on Government Reform and Oversight of the House of 
     Representatives, a written report detailing compliance by 
     each agency during the preceding reporting period with the 
     requirements of this title.

     SEC. 209. EFFECTIVE DATE.

       This title and the amendments made by this title shall take 
     effect on the date of the enactment of this Act.
                 TITLE III--REVIEW OF FEDERAL MANDATES

     SEC. 301. BASELINE STUDY OF COSTS AND BENEFITS.

       (a) In General.--No later than 18 months after the date of 
     enactment of this Act, the Advisory Commission on 
     Intergovernmental Relations (hereafter in this title referred 
     to as the ``Advisory Commission''), in consultation with the 
     Director, shall complete a study to examine the measurement 
     and definition issues involved in calculating the total costs 
     and benefits to State, local, and tribal governments of 
     compliance with Federal law.
       (b) Considerations.--The study required by this section 
     shall consider--
       (1) the feasibility of measuring indirect costs and 
     benefits as well as direct costs and benefits of the Federal, 
     State, local, and tribal relationship; and
       (2) how to measure both the direct and indirect benefits of 
     Federal financial assistance and tax benefits to State, 
     local, and tribal governments.

     SEC. 302. REPORT ON FEDERAL MANDATES BY ADVISORY COMMISSION 
                   ON INTERGOVERNMENTAL RELATIONS.

       (a) In General.--The Advisory Commission on 
     Intergovernmental Relations shall in accordance with this 
     section--
       (1) investigate and review the role of Federal mandates in 
     intergovernmental relations and their impact on State, local, 
     tribal, and Federal government objectives and 
     responsibilities, and their impact on the competitive balance 
     between State, local, and tribal governments, and the private 
     sector and consider views of and the impact on working men 
     and women on those same matters;
       (2) investigate and review the role of unfunded State 
     mandates imposed on local governments;
       (3) make recommendations to the President and the Congress 
     regarding--
       (A) allowing flexibility for State, local, and tribal 
     governments in complying with specific Federal mandates for 
     which terms of compliance are unnecessarily rigid or complex;
       (B) reconciling any 2 or more Federal mandates which impose 
     contradictory or inconsistent requirements;
       (C) terminating Federal mandates which are duplicative, 
     obsolete, or lacking in practical utility;
       (D) suspending, on a temporary basis, Federal mandates 
     which are not vital to public health and safety and which 
     compound the fiscal difficulties of State, local, and tribal 
     governments, including recommendations for triggering such 
     suspension;
       (E) consolidating or simplifying Federal mandates, or the 
     planning or reporting requirements of such mandates, in order 
     to reduce duplication and facilitate compliance by State, 
     local, and tribal governments with those mandates;
       (F) establishing common Federal definitions or standards to 
     be used by State, local, and tribal governments in complying 
     with Federal mandates that use different definitions or 
     standards for the same terms or principles; and
       (G)(i) the mitigation of negative impacts on the private 
     sector that may result from relieving State, local, and 
     tribal governments from Federal mandates (if and to the 
     extent that such negative impacts exist on the private 
     sector); and
       (ii) the feasibility of applying relief from Federal 
     mandates in the same manner and to the same extent to private 
     sector entities as such relief is applied to State, local, 
     and tribal governments; and
       (4) identify and consider in each recommendation made under 
     paragraph (3), to the extent practicable--
       (A) the specific Federal mandates to which the 
     recommendation applies, including requirements of the 
     departments, agencies, and other entities of the Federal 
     Government that State, local, and tribal governments utilize 
     metric systems of measurement; and
       (B) any negative impact on the private sector that may 
     result from implementation of the recommendation.
       (b) Criteria.--
       (1) In general.--The Commission shall establish criteria 
     for making recommendations under subsection (a).
       (2) Issuance of proposed criteria.--The Commission shall 
     issue proposed criteria under this subsection no later than 
     60 days after the date of the enactment of this Act, and 
     thereafter provide a period of 30 days for submission by the 
     public of comments on the proposed criteria.
       (3) Final criteria.--No later than 45 days after the date 
     of issuance of proposed criteria, the Commission shall--
       (A) consider comments on the proposed criteria received 
     under paragraph (2);
       (B) adopt and incorporate in final criteria any 
     recommendations submitted in those comments that the 
     Commission determines will aid the Commission in carrying out 
     its duties under this section; and
       (C) issue final criteria under this subsection.
       (c) Preliminary Report.--
       (1) In general.--No later than 9 months after the date of 
     the enactment of this Act, the Commission shall--
       (A) prepare and publish a preliminary report on its 
     activities under this title, including preliminary 
     recommendations pursuant to subsection (a);
       (B) publish in the Federal Register a notice of 
     availability of the preliminary report; and
       (C) provide copies of the preliminary report to the public 
     upon request.
       (2) Public hearings.--The Commission shall hold public 
     hearings on the preliminary recommendations contained in the 
     preliminary report of the Commission under this subsection.
       (d) Final Report.--No later than 3 months after the date of 
     the publication of the preliminary report under subsection 
     (c), the Commission shall submit to the Congress, including 
     the Committee on Government Reform and Oversight of the House 
     of Representatives, the Committee on Governmental Affairs of 
     the Senate, the Committee on the Budget of the Senate, and 
     the Committee on the Budget of the House of Representatives, 
     and to the President a final report on the findings, 
     conclusions, and recommendations of the Commission under this 
     section.
       (e) Priority to Mandates That Are Subject of Judicial 
     Proceedings.--In carrying out this section, the Advisory 
     Commission shall give the highest priority to immediately 
     investigating, reviewing, and making recommendations 
     regarding Federal mandates that are the subject of judicial 
     proceedings between the United States and a State, local, or 
     tribal government.
       (f) Definition.--For purposes of this section the term 
     ``State mandate'' means any provision in a State statute or 
     regulation that imposes an enforceable duty on local 
     governments, the private sector, or individuals, including a 
     condition of State assistance or a duty arising from 
     participation in a voluntary State program.

     SEC. 303. SPECIAL AUTHORITIES OF ADVISORY COMMISSION.

       (a) Experts and Consultants.--For purposes of carrying out 
     this title, the Advisory Commission may procure temporary and 
     intermittent services of experts or consultants under section 
     3109(b) of title 5, United States Code.
       (b) Detail of Staff of Federal Agencies.--Upon request of 
     the Executive Director of the Advisory Commission, the head 
     of any Federal department or agency may detail, on a 
     reimbursable basis, any of the personnel of that department 
     or agency to the Advisory Commission to assist it in carrying 
     out this title.
       (c) Administrative Support Services.--Upon the request of 
     the Advisory Commission, the Administrator of General 
     Services shall provide to the Advisory Commission, on a 
     reimbursable basis, the administrative support services 
     necessary for the Advisory Commission to carry out its duties 
     under this title.
       (d) Contract Authority.--The Advisory Commission may, 
     subject to appropriations, contract with and compensate 
     government and private persons (including agencies) for 
     property and services used to carry out its duties under this 
     title.

     SEC. 304. ANNUAL REPORT TO CONGRESS REGARDING FEDERAL COURT 
                   RULINGS.

       No later than 4 months after the date of enactment of this 
     Act, and no later than March 15 of each year thereafter, the 
     Advisory Commission on Intergovernmental Relations shall 
     submit to the Congress, including the Committee on Government 
     Reform and Oversight of the House of Representatives and the 
     Committee on Governmental Affairs of the Senate, and to the 
     President a report describing any Federal court case to which 
     a State, local, or tribal government was a party in the 
     preceding calendar year that required such State, local, or 
     tribal government to undertake responsibilities or 
     activities, beyond those such government would otherwise have 
     undertaken, to comply with Federal statutes and regulations.

     SEC. 305. DEFINITION.

       Notwithstanding section 3 of this Act, for purposes of this 
     title the term ``Federal mandate'' means any provision in 
     statute or regulation or any Federal court ruling that 
     imposes an enforceable duty upon State, local, or tribal 
     governments including a condition of Federal assistance or a 
     duty arising from participation in a voluntary Federal 
     program.

     SEC. 306. AUTHORIZATION OF APPROPRIATIONS.

       There are authorized to be appropriated to the Advisory 
     Commission to carry out section 301 and section 302, $500,000 
     for each of fiscal years 1995 and 1996.
                       TITLE IV--JUDICIAL REVIEW

     SEC. 401. JUDICIAL REVIEW.

       (a) Agency Statements on Significant Regulatory Actions.--
       (1) In general.--Compliance or noncompliance by any agency 
     with the provisions of sections 202 and 203(a) (1) and (2) 
     shall be subject to judicial review only in accordance with 
     this section.
       (2) Limited review of agency compliance or noncompliance.--
     (A) Agency compliance or noncompliance with the provisions of 
     sections 
     [[Page H3059]] 202 and 203(a) (1) and (2) shall be subject to 
     judicial review only under section 706(1) of title 5, United 
     States Code, and only as provided under subparagraph (B).
       (B) If an agency fails to prepare the written statement 
     (including the preparation of the estimates, analyses, 
     statements, or descriptions) under section 202 or the written 
     plan under section 203(a) (1) and (2), a court may compel the 
     agency to prepare such written statement.
       (3) Review of agency rules.--In any judicial review under 
     any other Federal law of an agency rule for which a written 
     statement or plan is required under sections 202 and 203(a) 
     (1) and (2), the inadequacy or failure to prepare such 
     statement (including the inadequacy or failure to prepare any 
     estimate, analysis, statement or description) or written plan 
     shall not be used as a basis for staying, enjoining, 
     invalidating or otherwise affecting such agency rule.
       (4) Certain information as part of record.--Any information 
     generated under sections 202 and 203(a) (1) and (2) that is 
     part of the rulemaking record for judicial review under the 
     provisions of any other Federal law may be considered as part 
     of the record for judicial review conducted under such other 
     provisions of Federal law.
       (5) Application of other federal law.--For any petition 
     under paragraph (2) the provisions of such other Federal law 
     shall control all other matters, such as exhaustion of 
     administrative remedies, the time for and manner of seeking 
     review and venue, except that if such other Federal law does 
     not provide a limitation on the time for filing a petition 
     for judicial review that is less than 180 days, such 
     limitation shall be 180 days after a final rule is 
     promulgated by the appropriate agency.
       (6) Effective date.--This subsection shall take effect on 
     October 1, 1995, and shall apply only to any agency rule for 
     which a general notice of proposed rulemaking is promulgated 
     on or after such date.
       (b) Judicial Review and Rule of Construction.--Except as 
     provided in subsection (a)--
       (1) any estimate, analysis, statement, description or 
     report prepared under this Act, and any compliance or 
     noncompliance with the provisions of this Act, and any 
     determination concerning the applicability of the provisions 
     of this Act shall not be subject to judicial review; and
       (2) no provision of this Act shall be construed to create 
     any right or benefit, substantive or procedural, enforceable 
     by any person in any administrative or judicial action.

       And the House agree to the same.
     William F. Clinger,
     Rob Portman,
     David Dreier,
     Tom Davis,
     Gary Condit,
     Cardiss Collins,
     Edolphus Towns,
     Joe Moakley,
                                Managers on the Part of the House.
     Dirk Kempthorne,
     Bill Roth,
     Pete V. Domenici,
     John Glenn,
     J.J. Exon,
                               Managers on the Part of the Senate.
       JOINT EXPLANATORY STATEMENT OF THE COMMITTEE OF CONFERENCE

       The managers on the part of the House and the Senate at the 
     conference on the disagreeing votes of the two Houses on the 
     amendment of the House to the bill (S. 1) to curb the 
     practice of imposing unfunded Federal mandates on States and 
     local governments; to strengthen the partnership between the 
     Federal Government and State, local and tribal governments; 
     to end the imposition, in the absence of full consideration 
     by Congress of Federal mandates on State, local, and tribal 
     governments without adequate funding, in a manner that may 
     displace other essential governmental priorities; and to 
     ensure that the Federal government pays the costs incurred by 
     those governments in complying with certain requirements 
     under Federal statutes and regulations; and for other 
     purposes, submit the following joint statement to the House 
     and the Senate in explanation of the effect of the action 
     agreed upon by the managers and recommended in the 
     accompanying conference report:
       The House amendment to the text of the bill struck out all 
     of the Senate bill after the enacting clause and inserted a 
     substitute text.
       The Senate recedes from its disagreement to the amendment 
     of the House with an amendment which is a substitute for the 
     Senate bill and the House amendment. The differences between 
     the Senate bill, the House amendment, and the substitute 
     agreed to in conference are noted below, except for clerical 
     corrections, conforming changes made necessary by agreements 
     reached by the conferees, and minor drafting and clarifying 
     changes.
     Sec. 2. Purposes
       The Senate Bill includes a list of purposes for S. 1.
       The House amendment contains a similar list with one 
     exception. Subsection (8) of the House Amendment states that 
     one of the purposes is to begin consideration of methods to 
     relieve State, local, and tribal governments of unfunded 
     mandates that result from Court interpretations of statutes 
     and regulations.
       The Conference Substitute adopts the House provision with 
     an amendment. The substitute provides under subsection (8) 
     that one of the purposes of the bill is to begin the 
     consideration of the effect of mandates on States, local 
     governments, and tribal governments, including those imposed 
     by court interpretations of Federal statutes.
     Sec. 3. Definitions
       The Senate Bill provides that for purposes of this Act the 
     terms defined under Sec. 408(h) of the Congressional Budget 
     and Impoundment Control Act of 1974 (as added by Sec. 101 of 
     this Act) shall have the meanings as defined. The Senate Bill 
     also defines the term ``Director'' as the Director of the 
     Congressional Budget Office.
       The House Amendment provides that for purposes of this Act 
     the terms defined under Sec. 421 of the Congressional Budget 
     Act of 1974 (as added by Sec. 301 of this Act) shall have the 
     meanings as defined. The House Amendment also defines the 
     term ``small government''.
       The Conference Substitute adopts the Senate language with 
     technical changes.
     Sec. 4. Exclusions
       Section 4 of the Senate Bill, titled ``Exclusions'', sets 
     out those provisions that are exempt from S. 1.
       Section 4 of the House Amendment, titled ``Limitation on 
     Application'', establishes a similar list of exempt 
     provisions with two differences. For the exclusion applying 
     to legislation that prohibits discrimination, the House uses 
     ``gender'' rather than ``sex'' and does not include 
     ``color.'' The House bill also includes an exclusion for any 
     provision that pertains to Social Security.
       The Conference Substitute adopts the Senate Bill's language 
     with a narrower exclusion for Social Security. The Substitute 
     only excludes legislation that relates to Title II of the 
     Social Security Act.
     Sec. 5. Agency assistance
       The Senate Bill requires agencies to provide information 
     and assistance to the Director of the Congressional Budget 
     Office in carrying out this Act.
       The House Amendment contains no such provision.
       The Conference Substitute adopts the Senate language.

             Title I. Legislative Accountability and Reform

     Sec. 101. Legislative Mandate Accountability and Reform
       Section 101 of the Senate Bill adds a new section 408 to 
     the Congressional Budget and Impoundment Control Act of 1974 
     that establishes new Congressional procedures for the 
     consideration of mandate legislation.
       Section 301 of the House Amendment divides Title IV of the 
     Budget Act into two parts. Part A contains all the existing 
     provisions of Title IV of the Budget Act. Part B contains the 
     new procedures for Congressional consideration of mandate 
     legislation.
       Section 101 of the Conference Substitute adopts the House 
     framework for amending the Budget Act. It adds new sections 
     421 through 428 as Part B of the Budget Act.
     Sec. 421. Definitions
       Section 101(a) of the Senate Bill adds a new Section 408(h) 
     to the Budget Act that defines terms for the purposes of this 
     Act. This subsection defined the following terms: ``Federal 
     intergovernmental mandate'', ``Federal private sector 
     mandate'', ``Federal mandate'', ``Federal mandate direct 
     costs'', ``amount'', ``private sector'', ``local 
     government'', ``tribal government'', ``small government'', 
     ``State'', ``agency'', ``regulation'' (or ``rule''), and 
     ``direct savings''.
       The House Amendment defines a similar list of terms as a 
     new section 421 of the Budget Act with the following 
     differences. The House Amendment does not include in the 
     definition of the term ``Federal Intergovernmental Mandate'' 
     a reduction or elimination of the amount authorized to be 
     appropriated for the control of borders by the Federal 
     Government or for reimbursement of net costs associated with 
     illegal, deportable, and excludable aliens, unless the State, 
     Local, or tribal government has not fully cooperated with 
     Federal efforts to locate, apprehend, and deport illegal 
     aliens. In the definition of the term ``Federal Mandate 
     Direct Costs,'' the House Amendment includes the aggregated 
     estimated amounts forgone in revenues in order to comply with 
     a Federal intergovernmental mandate. The House amendment 
     defines ``private sector'' to include ``business trusts, or 
     legal representatives and organized groups of individuals'' 
     and excludes from this definition ``all persons or entities 
     in the United States.'' The House Amendment does not exclude 
     from the definition of ``agency'' the Office of the 
     Comptroller of the Currency and the Office of Thrift 
     Supervision. The House Amendment does not include a 
     definition of ``amount'', ``tribal government'', or ``direct 
     savings''. The House Amendment includes a definition of 
     ``Director'', ``Federal Financial Assistance'', and 
     ``Significant Employment Impact''.
       The Conference Substitute includes the list of definitions 
     in a new section 421 of the Budget Act. The Substitute uses 
     the Senate list of definitions with the House language on 
     revenue forgone and defines the term ``agency'' as provided 
     in the House Amendment. The Substitute defines the term 
     ``Director'' in section 3.
       The Conference Substitute defines direct costs to include 
     the aggregate amount State, local, and tribal governments 
     would be prohibited for raising in revenue including user 
     fees. The conferees note that the Joint Committee on Taxation 
     is responsible for providing revenue estimates to CBO for 
     legislation that affects revenues. CBO works closely with the 
     Joint Tax Committee to assure 
     [[Page H3060]] these revenue estimates are reflected in cost 
     estimates. The conferees do not intend to disrupt CBO's and 
     the Joint Committee's respective responsibilities and expect 
     the Joint Committee on Taxation will provide Congress with 
     estimates for legislation that prohibits State, local, or 
     tribal governments from raising revenue.
       Subsection 5(B) of the Conference Substitute includes in 
     the definition of an intergovernmental mandate any provision 
     in legislation, statute, or regulation that relates to a 
     then-existing Federal program that would place caps upon, or 
     otherwise decrease, the Federal Government's responsibility 
     to provide entitlement funding to State, local, or tribal 
     governments under the program. The conferees intend that this 
     definition only apply to caps on individual programs. The 
     conferees do not intend this definition to be applicable to a 
     measure that contains general budgetary limits or caps on 
     spending or categories of spending, unless that measure also 
     contained implementing statutory language for reductions 
     required in specific programs if the budgetary limit or cap 
     were exceeded.
       The programs to which this definition relates are Federal 
     entitlement programs that provide $500 million or more 
     annually to State, local and tribal governments. This would 
     currently include only nine programs: Medicaid; AFDC, Child 
     Nutrition; Food Stamps; Social Services Block Grants; 
     Vocational Rehabilitation State Grants; Foster Care, Adoption 
     Assistance and Independent Living; Family Support Payments 
     for Job Opportunities and Basic Skills (JOBS); and, Child 
     Support Enforcement. This subsection would also apply to 
     entitlement programs that Congress may create in the future 
     where Congress provides $500 million or more annually to 
     State, local and tribal governments.
       The conferees do not interpret the meaning of ``enforceable 
     duty'' in subsection (5)(A)(i) and (ii) to include duties and 
     conditions that are part of any voluntary Federal contract 
     for the provision of goods and services.
     Sec. 422. Exclusions
       Section 101(a) of the Senate Bill adds a new Section 408(g) 
     to the Budget Act that provides the same exclusions as 
     contained in section 4 of S. 1.
       Section 301(a) of the House Amendment adds a new section 
     422 to the Budget Act that provides the same limitations on 
     application as a section 4 of the Amendment.
       Section 101(a) of the Conference Substitute adds a new 
     Section 422 to the Budget Act that repeats the same 
     exclusions provided in section 4 of the Substitute.
     Sec. 423. Committee reports
       Section 101(a) of the Senate Bill adds a new Section 408(a) 
     to the Budget Act that requires an authorizing committee, 
     when it orders reported a public bill or joint resolution 
     (hereafter ``a measure'') establishing or affecting any 
     Federal mandates, to submit the measure to CBO and identify 
     the mandates involved. The Senate Bill requires that reports 
     by authorizing committees on measures dealing with Federal 
     mandates include the following information on the mandates in 
     the bill: an identification of the mandates, a cost-benefit 
     analysis, the impact on the public and private sector 
     competitive balance, information on Federal funding 
     assistance to cover the cost of the mandate (including how 
     Federal funding will be allocated among different levels of 
     government), the extent to which the bill preempts State, 
     local, or tribal government law, and a CBO cost estimate.
       Section 301(a) of the House Amendment adds a new section 
     423 to the Budget Act that establishes similar requirements 
     for committee reports except the Amendment does not require 
     the report to indicate whether the mandate bill includes a 
     mechanism to allocate funding in accordance with costs to 
     different levels of government.
       Section 101(a) of the Conference Substitute adds a new 
     Section 423 to the Budget Act that adopts the Senate's 
     requirements for reports with technical changes.
     Sec. 424. CBO Cost Estimates
       Section 101(a) of the Senate Bill adds a new Section 
     408(b)(1) to the Budget Act that requires CBO to prepare, and 
     submit to the reporting committee, an estimate of the direct 
     costs to the State, local, and tribal governments of Federal 
     intergovernmental mandates in each reported measure (or in 
     necessary implementing regulations). For intergovernmental 
     mandates, CBO is required to prepare estimates if the costs 
     of the mandate would equal at least $50 million in any of the 
     five fiscal years after the mandate's effective date. For 
     private sector mandates, CBO is required to prepare estimates 
     if the costs of the mandate would equal at least $200 million 
     in any of the five fiscal years after the mandate's effective 
     date. The Senate bill extends the scope of the estimate to 
     ten years following the mandate's effective date.
       The Senate Bill provides if CBO finds it not feasible to 
     make a reasonable estimate, CBO must report that finding with 
     an explanation. If CBO makes such a determination for an 
     intergovernmental mandate, then a point of order would lie 
     against the reported bill only for failure to contain such an 
     estimate under section 408(c)(1)(A). In such case, the bill 
     as reported would be exempt only from the point of order 
     under section 408(c)(1)(B). Other Budget Act points of order 
     would still lie if applicable.
       Section 408(b)(3) of the Senate Bill provides that if 
     direct cost of respective mandates in a measure fall below 
     the thresholds, CBO is to so state, and is to explain briefly 
     the basis of this estimate. Paragraph (4) of this subsection 
     requires a conference committee, under certain circumstances, 
     to ensure that CBO prepare a supplemental estimate on a 
     measure passed by either house in an amended form (including 
     a measure of one house passed by the other with an amendment 
     in the nature of a substitute) or reported from conference in 
     an amended form. The Senate Bill requires such action if the 
     amended form contains a mandate not previously considered by 
     either house or increases the direct cost of a mandate in the 
     measure.
       Section 301(a) of the House Amendment adds a new section 
     424(a) to the Budget Act that establishes similar 
     requirements for CBO cost estimates on mandates. The House 
     Amendment provides the threshold is $50 million for both 
     intergovernmental and private sector mandates. In addition, 
     the Amendment does not limit the scope of the estimate to ten 
     years.
       Section 101(a) of the Conference Substitute adds a new 
     Section 424 to the Budget Act that adopts the Senate language 
     on CBO's responsibilities for preparing estimates on 
     legislation containing intergovernmental and private sector 
     mandates with two changes. The Substitute amends the language 
     the Senate proposed on the scope of CBO cost estimates. If 
     the bill would authorize appropriations and makes an 
     intergovernmental mandate contingent on appropriations as 
     provided in section 425(a)(2)(B) in the Conference 
     Substitute, then CBO is required to provide an estimate of 
     the budget authority needed to pay for the mandate for each 
     fiscal year for a period not to exceed ten years. The 
     Substitute provides a threshold of $100 million for private 
     sector mandates.
     Sec. 425. Points of Order Against Unfunded Mandates
       Point of Order & Mandate Cost Estimates
       Section 101(a) of the Senate Bill adds a new Section 
     408(c)(1)(A) to the Budget Act that establishes a point of 
     order in the Senate against consideration of a reported 
     measure containing a mandate unless the report accompanying 
     the measure contains a CBO cost estimate of the mandate, or 
     the CBO cost estimate has been published in the Congressional 
     Record.
       Section 301(a) of the House Amendment adds a new Section 
     424(a)(1) to the Budget Act that establishes a similar point 
     of order in the Senate and the House against consideration of 
     a reported measure, but provides it does not apply to 
     supplemental estimates prepared by CBO.
       Section 101(a) of the Conference Substitute adds a new 
     Section 425(a) to the Budget Act that adopts the House 
     language with minor changes.
       Point of Order & Unfunded Mandate Legislation
       Section 101(a) of the Senate Bill adds a new Section 
     408(c)(1)(B) to the Budget Act that establishes a point of 
     order in the Senate against consideration of a bill, joint 
     resolution, amendment, motion, or conference report 
     (hereafter referred to as ``legislation'') containing 
     intergovernmental mandates exceeding the thresholds 
     established above, unless the legislation funds these 
     mandates. The Senate bill applies this point of order against 
     legislation that would cause the direct costs of 
     intergovernmental mandates to breach the $50 million annual 
     threshold. The waiver of this point of order and the appeal 
     of rulings regarding this point of order are covered by 
     existing provisions under title IX of the Budget Act. Section 
     904 provides that in the Senate points of order under title 
     IV of the Budget Act, including the point of order regarding 
     unfunded mandate legislation, can be waived or appealed by a 
     simple majority.
       This subparagraph of the Senate Bill provides that 
     legislation is not subject to the point of order if it 
     provides either: (1) direct spending authority equal to the 
     mandate's costs for each fiscal year; (2) an increase in 
     receipts and an increase in direct spending authority for 
     each fiscal year for those mandates equal to their costs for 
     each fiscal year; or, (3) an authorization of appropriations 
     at least equal to the direct cost and provides a mechanism to 
     ensure that a mandate is effective only to the extent that it 
     is funded in appropriations Acts.
       The House Amendment establishes a similar point of order 
     against consideration of legislation in the House and Senate 
     containing intergovernmental mandates. The House amendment 
     differs from the Senate bill on the requirements of funding 
     mechanisms for mandates. Under the House amendment, 
     legislation is subject to the point of order unless it 
     provides: (1) new budget authority or new entitlement 
     authority in the House (or direct spending authority in the 
     Senate) in an amount that equals or exceeds the direct costs 
     of the mandate; (2) an increase in receipts or a decrease in 
     new budget authority or new entitlement authority in the 
     House (a decrease in direct spending authority in the Senate) 
     to offset the costs of spending authority for the mandate; 
     or, (3) an authorization of appropriations at least equal to 
     the direct cost and provides a mechanism to ensure that a 
     mandate never takes effect unless fully funded in 
     appropriations Acts or mandates are scaled back consistent 
     with appropriations levels.
       The Conference Substitute adopts the House language with an 
     amendment. The 
     [[Page H3061]] Substitute provides that legislation 
     containing a Federal intergovernmental mandate is out of 
     order in the House and Senate unless it provides either: (1) 
     new budget authority or new entitlement authority in the 
     House (or direct spending authority in the Senate) in an 
     amount that equals or exceeds the direct costs of the 
     mandate; or (2) an authorization of appropriations and a 
     mechanism to assure the mandate is only effective to the 
     extent funding is provided in Appropriations Acts. If 
     legislation funds the mandate to avoid the point of order, it 
     must fund the entire cost of the mandate for each fiscal 
     year.
       The Substitute drops language in the House Amendment that 
     provides a mandate could be paid for by an increase in 
     spending authority and offset by a decrease in spending 
     authority or an increase in receipts. This language is 
     unnecessary because other budget laws already would govern 
     how Federal mandates could be financed.
       Nothing in the Substitute waives existing provisions of law 
     that establish controls on Federal spending. The Budget Act, 
     budget resolutions adopted pursuant to the Budget Act, and 
     the Balanced Budget and Emergency Deficit Control Act already 
     establish requirements for Federal budgeting. Since these 
     laws already control legislation providing Federal funding, 
     including funding that could be provided to cover a mandate's 
     direct costs, the conference agreement does not address 
     requirements for offsets to pay for Federal funding for 
     mandates.
       The Substitute provides that the point of order can be 
     avoided if the mandate is paid for by either an increase in 
     spending authority outside the appropriations process (new 
     budget authority or new entitlement authority in the House of 
     Representatives and new direct spending authority in the 
     Senate) or is contingent on funding being provided in the 
     appropriations process.
       If a Committee chooses to fund a mandate with spending 
     authority outside the appropriations process, this 
     legislation will be subject to the requirements of the Budget 
     Act and the pay-as-you-go provisions of the Balanced Budget 
     and Emergency Deficit Control Act. If a committee chooses to 
     pay for a mandate with an increase in spending authority 
     outside the Appropriations process, there are generally three 
     options under these laws: provide new spending authority that 
     will cause a deficit increase; provide new spending authority 
     and offset it by reducing existing spending authority for 
     other programs; or, provide new spending authority and offset 
     it by increasing receipts. If a committee chooses to make the 
     mandate contingent on funding being provided in 
     Appropriations Acts, the Appropriations Committees will have 
     to fund these mandates within the annual allocations made 
     under section 602 of the Budget Act and the discretionary 
     caps under section 601 of the Budget Act.
       Point of Order & the Appropriations Process
       Section 101(a) of the Senate Bill adds a new Section 
     408(c)(1)(B)(iii) to the Budget Act that allows legislation 
     to avoid the unfunded mandate point of order if the mandate 
     is contingent on funding being provided in the appropriations 
     process. More specifically, the legislation would escape the 
     point of order if it: (1) authorizes appropriations in an 
     amount equal to the direct costs of the mandate; (2) 
     specifies the amount of direct costs of the mandate for each 
     year or other period up to ten years during which the mandate 
     will be in effect; (3) identifies any appropriation bill that 
     would be expected to provide funding for direct costs of the 
     mandate; and (4) provides that, if appropriations are 
     insufficient to cover the direct cost of the mandate (as 
     previously calculated by CBO), the mandate will expire unless 
     Congress provides otherwise by law (through expedited 
     procedures).
       Section 408(c)(1)(B)(iii)(III) of the Senate Bill requires 
     mandate legislation to include procedures in the event 
     insufficient appropriations are provided to cover the entire 
     direct costs of a Federal intergovernmental mandate for a 
     fiscal year. If appropriations provided are insufficient for 
     the mandate, the Agency is required to notify Congress within 
     30 days of the beginning of the fiscal year and submit 
     either: (1) a statement, based on a re-estimate of the direct 
     costs of the mandate, that the lower appropriations is 
     sufficient; or, (2) legislative recommendations for 
     implementing a less costly mandate or making the mandate 
     ineffective for the fiscal year. Sixty days after the Agency 
     submission, the mandate ceases to be effective unless 
     Congress provides otherwise by law (see Appendix). Only if 
     the appropriation is less than the direct cost of the 
     mandate, the agency is required to submit a statement or 
     legislative recommendation.
       Section 408(c)(1)(B)(iii)(III)(bb) stipulates that the 
     relevant committees in both the House and Senate provide an 
     expedited procedure in the underlying intergovernmental 
     legislation for the consideration of agency statements and 
     legislative recommendations. If the relevant committees of 
     the House and Senate choose not to include expedited 
     procedures in the underlying intergovernmental mandates 
     legislation, then a point of order may be raised against that 
     legislation.
       Section 408(c)(3)(A) of the Senate Bill exempts 
     appropriations legislation from the points of order against 
     unfunded mandates but establishes a procedure to extract 
     legislative intergovernmental mandate provisions in 
     appropriations legislation. An appropriations bill, 
     resolution, amendment thereto, or conference report thereon 
     that contains a provision with an intergovernmental mandate 
     that exceeds the thresholds established in the Bill is out of 
     order in the Senate. Upon a point of order being sustained 
     against provisions in appropriations legislation containing 
     mandates, the offending provision is deemed strickened from 
     the measure.
       Section 408(c)(2) allows State, local, or tribal 
     governments to continue to voluntarily comply with the 
     original intergovernmental mandate at its own expense.
       Section 301(a) of the House Amendment adds a new Section 
     425(a)(2)(C) to the Budget Act that establishes different 
     procedures for intergovernmental mandates that are contingent 
     on appropriations Acts. More specifically, if mandate 
     legislation funds an intergovernmental mandate through an 
     authorization of appropriations, in order to avoid the point 
     of order, the legislation must either: 1) require the 
     implementing agency to repeal the mandate at the beginning of 
     the fiscal year unless there are sufficient appropriations to 
     cover the full cost of the mandate; or, 2) require the 
     implementing agency to reduce the requirements of the mandate 
     to bring its costs within the amount provided in the 
     appropriations Act.
       Second, the House Amendment exempts appropriations bills 
     and amendments thereto from the point of order.
       Section 101(a) of the Conference Substitute adds a new 
     section 425(a)(2)(B)(iii) to the Budget Act, which adopts the 
     Senate language with technical changes. In the House of 
     Representatives and the Senate, the requirements of subclause 
     (II) shall be considered as fulfilled by inclusion in the 
     authorization bill of any procedural prescription to expedite 
     consideration of the statement or legislative 
     recommendations, including a requirement that the authorizing 
     committee consider the statement or legislative 
     recommendations on an expedited basis.
       If an agency submits a statement with a re-estimate of the 
     direct costs of a mandate or legislative recommendations 
     pursuant to section 425(a)(2)(B)(iii), the conferees expect 
     the agency to submit this statement or legislative 
     recommendations to CBO for its review and comment. The 
     conferees expect the relevant agency to fully and freely 
     share with CBO the information used in developing the re-
     estimate or the legislative recommendations for a less-costly 
     mandate. CBO should make its review and comments available to 
     Congress as appropriate.
       The agency is expected to consult with State, local, and 
     tribal governments in preparing its re-estimate or its 
     legislative recommendations for a less costly mandate.
       Determinations of Applicability of the Point of Order
       Section 101(a) of the Senate Bill adds a new Section 
     408(c)(4) to the Budget Act that requires the Presiding 
     Officer of the Senate to consult with the Senate Governmental 
     Affairs Committee, to the extent practicable, on the 
     applicability of the point of order in the Senate. Paragraph 
     (5) provides that the levels of mandates for a fiscal year be 
     determined on the basis of estimates by the Senate Budget 
     Committee.
       Section 301(a) of the Senate Bill adds a new Section 425(c) 
     to the Budget Act that only provides that mandate levels be 
     based on estimates made by the Budget Committees, in 
     consultation with CBO.
       The Conference Substitute contains the Senate language as a 
     new section 425 (d) and (e) of the Budget Act.
     Sec. 426. Provisions Relating to the House of Representatives
       Section 101(a) of the Senate Bill adds a new Section 408(d) 
     to the Budget Act that makes it out of order in the House to 
     consider a rule or order that waives the point of order 
     established by S. 1.
       Section 301(a) of the House Amendment adds a new Section 
     426 to the Budget Act that contains the same provision as the 
     Senate Bill. Section 427 of the House Amendment establishes 
     procedures for the disposition of the point of order in the 
     House.
       The Conference Substitute contains the House language on 
     House waivers of rules as a new section 426(a) of the Budget 
     Act. Section 426(b) of the Substitute contains the House 
     language on the House's disposition of points of order.
     Sec. 427. Senator's requests for CBO cost estimates
       The Senate Bill requires CBO to prepare a cost estimate on 
     a bill, joint resolution, amendment, or motion containing an 
     intergovernmental mandate at the written request of any 
     Senator.
       The House Amendment contained no such provision.
       Section 101(a) of the Conference Substitute adds a new 
     section 427 to the Budget Act that narrows the Senate 
     language so that it only applies to cost estimates for 
     amendments that contain intergovernmental mandates. The 
     conferees note CBO already responds to members requests for 
     cost estimates to the extent practicable. Viewing the concern 
     about the applicability of this point of order to amendments 
     that would cause the intergovernmental mandate thresholds to 
     be exceeded, however, the conferees have retained language 
     requiring CBO, to the extent practicable, to prepare cost 
     estimates for a Senator's amendment if it were to cause the 
     thresholds to be exceeded.
       This more limited language is not intended to preclude CBO 
     from preparing mandate 
     [[Page H3062]] cost estimates for bills. These requirements 
     are already provided for in section 424 of the Substitute 
     regarding reported bills and conference reports. Moreover, 
     the conferees intend that CBO be responsive to Senator's 
     requests in preparing cost estimates for bills and joint 
     resolutions that may be marked up or for bills and 
     resolutions that may be offered as amendments.
     Sec. 428. Clarification on the application
       Section 101(a) of the Senate Bill adds a new subsection 
     408(f) to the Budget Act, which clarifies that application of 
     section 408 to legislation. If a legislative measure would 
     reauthorize or amend existing statutes, the points of order 
     established by the bill would apply only if the measure would 
     either: (1) reduce net authorized financial assistance for 
     complying with mandates by an amount that would cause a 
     breach of the thresholds, without reducing duties by a 
     corresponding amount: or, (2) otherwise increase the net 
     aggregate direct costs of mandates by an amount that would 
     cause a breach of the thresholds. The Senate Bill also 
     provides that the net direct cost of Federal mandates in 
     legislation means the net increase of those costs as compared 
     to current law levels. If mandate legislation is extending an 
     authorization of appropriations, the levels authorized in the 
     mandate legislation are to be compared to the last year in 
     which appropriations are authorized under current law.
       Section 301(a) of the House Amendment adds a new Section 
     425(d) to the Budget Act that provides narrower language for 
     limiting the application of part B.
       The Conference Substitute contains the Senate language as a 
     new section 428 of the Budget Act.
     Sec. 102. CBO assistance to committees and studies
       Section 102(l) of the Senate Bill amends section 202 of the 
     Budget Act to add to CBO's responsibilities a requirement to 
     assist committees in analyzing legislative proposals that may 
     have significant budgetary impact on State, local, and tribal 
     governments, or significant financial impact on the private 
     sector. The Bill also amends section 202 of the Budget Act to 
     require CBO to prepare studies at the request of the chairman 
     or ranking minority member of a committee. Subsection (h)(1), 
     regarding continuing studies, restates existing law. 
     Subsection (h)(2) adds new provisions regarding mandate 
     studies.
       Section 102(2) of the Senate Bill amends section 301(d) of 
     the Budget Act to require committees to comment on mandate 
     legislation as part of their views and estimates submissions 
     to the Budget Committees.
       Section 301(a) of the House Amendment adds a new section 
     424(b) and (c), which includes similar language as the Senate 
     Bill except that the House Amendment requires CBO to assist 
     committees in assessing mandate legislation that will have a 
     significant employment impact on the private sector.
       The Conference Substitute contains the Senate language with 
     an amendment to reflect the House language to require CBO to 
     assist committees in assessing the impact of private sector 
     mandates on employment. The Substitute drops the definition 
     of employment for the purposes of this section.
     Sec. 103. Cost of Regulations
       Section 103 of the Senate Bill express the sense of 
     Congress that agencies should review planned regulations to 
     ensure that they take CBO cost estimates into consideration. 
     It also requires CBO, at the request of any Senator, to 
     estimate the cost of regulations implementing mandate 
     legislation and compare it with the CBO cost estimate for the 
     legislation itself. It directs OMB to provide CBO with such 
     data and cost estimates.
       The House Amendment contains no such provision.
       The Conference Substitute adopts the Senate language with 
     an amendment to narrow the section in two respects. First, 
     the section provides that the chairman or ranking minority 
     member of a committee can request such a study, consistent 
     with requests for mandate studies (section 102 of S. 1). 
     Second, the section requires CBO to compare the agency's cost 
     estimate to the estimate prepared by CBO when the legislation 
     was considered. In preparing a comparison, the conferees 
     intend that CBO critique the agency cost estimate in such 
     comparison to make sure it is an accurate reflection of the 
     cost of the mandate.
       The primary objective of the Unfunded Mandate Reform Act is 
     to make sure Congress is adequately informed of the cost 
     mandates in legislation when they are considered. The 
     conferees are particularly concerned about instances in which 
     agencies exceed their discretion to impose regulations that 
     are much more costly than anticipated when the legislation 
     was considered. The intent of this section is to provide, 
     when requested, a review of agencies' actions and estimates 
     to make sure they are consistent with the costs of the 
     mandate when Congress considered the legislation.
     Sec. 104. Repeal of existing requirements for CBO mandate 
         cost estimates
       Section 106 of the Senate Bill repeals provisions in 
     section 403 of the Budget Act that are superseded by Part B.
       Section 305 of the House Amendment contained similar 
     language.
       Section 104 of the Conference Substitute contains the 
     Senate language.
     Sec. 105. Consideration for Federal funding
       Section 107 of the Senate bill provides that nothing in S. 
     1 denies federal funding to State, local, or tribal 
     governments because they are already complying with all or 
     part of a federal mandate.
       The House Amendment contains no such provision.
       The Conference Substitute contains the Senate language with 
     a clarification that it applies to section 425(b)(2). The 
     Conferees do not intend this section to create any legally 
     binding duty to pay these governments, nor is it intended to 
     affect the calculation of mandate estimates or Federal budget 
     cost estimates.
     Sec. 106. Impact on local governments
       Section 108 of the Senate Bill includes findings about cost 
     shifting from Federal to State and local, and from State to 
     local, governments, and resultant increases in property taxes 
     and service cuts. This section states the sense of the Senate 
     that these practices should cease and that curbing them, and 
     reducing taxes and spending at all levels, are primary 
     objectives of this Act.
       The House Amendment contains no such provision.
       The Conference Substitute adopts the Senate language as 
     section 106.
     Sec. 107. Enforcement in the House of Representatives
       The Senate Bill did not include language on enforcement in 
     the House of Representatives.
       Section 302 of the House Amendment amends House Rule XXIII 
     so that when the Committee of the Whole is considering an 
     amendment that includes a provision that would have been 
     subject to a point of order established by the bill, it will 
     be in order to move to strike that provision, unless the 
     special rule for considering the measure specifically 
     prohibits the motion. The House Amendment also requires the 
     Committee on Rules to list in its activities reports all 
     special rules waiving points of order established by the 
     bill, and the measures to which they related.
       The Conference Substitute contains the House language as 
     section 107.
     Sec. 108. Exercise of rulemaking
       Section 105 of the Senate Bill provides that certain 
     provisions of S. 1 are enacted pursuant to the rulemaking 
     power of each house.
       Section 303 of the House Amendment contains similar 
     language.
       Section 108 of the Conference Substitute preserves the 
     rulemaking authority of the houses.
     Sec. 109. Authorization of appropriations
       Section 104 of the Senate authorizes $4.5 million annually 
     through fiscal year 2002 for CBO to carry out this act.
       Section 421(e) of the House Amendment contains the same 
     language.
       Section 109 of the Conference Substitute authorizes 
     appropriations for CBO. The conferees note that this Act 
     provides a major expansion in the responsibilities of CBO and 
     recognize the need for additional funding in order for CBO to 
     carry out these responsibilities. The conferees intend that 
     these new responsibilities should not supplant CBO's existing 
     responsibilities under the Budget Act.
     Sec. 110. Effective date
       Section 109 of the Senate Bill provides an effective date 
     of January 1, 1996, or 90 days after an appropriation for CBO 
     authorized by the Bill becomes available.
       Section 306 of the House Amendment provides an effective 
     date of October 1, 1995.
       The Conference Substitute contains the Senate language as 
     section 110.
             Title II. Regulatory Accountability and Reform

     Sec. 201. Regulatory process
       The Senate bill, in section 201, directs each agency, ``to 
     the extent permitted in law'', to assess the effects of 
     regulations on State and local governments and the private 
     sector, and to minimize regulatory burdens that affect the 
     governmental entities. It authorizes the appropriation of 
     such sums as are necessary to carry out this title.
       The House amendment, in section 201, contains a similar 
     provision.
       The Conference substitute directs each agency, unless 
     otherwise prohibited by law, to assess the effects of 
     regulatory actions on State, local, and tribal governments 
     and the private sector (other than to the extent that such 
     regulations incorporate requirements specifically set forth 
     in law).
     Sec. 202. Statements to accompany significant regulatory 
         actions
       The Senate bill, in section 202, requires that before 
     promulgating any final rule that includes a Federal 
     intergovernmental mandate that may result in aggregate costs 
     to State, local, or tribal governments, and the private 
     sector, of $100,000,000 or more in any one year, or any 
     general notice of proposed rulemaking that is likely to 
     result in such a rule, an agency must prepare a written 
     statement. The statement must estimate anticipated costs to 
     such governments and the private sector of complying with the 
     intergovernmental mandate, as well as (to the extent that the 
     agency determines that accurate estimates are reasonably 
     feasible) the future compliance costs of the mandate, and any 
     disproportionate budgetary effects of the mandate on any 
     particular region of the nation or type of community. Also 
     included in the statement must be a qualitative, and if 
     possible, quantitative assessment of the costs and benefits 
     anticipated from the intergovernmental mandate, the effect of 
     the 
     [[Page H3063]] private sector mandate on the national 
     economy, a description of the extent of prior consultation 
     with State and local elected officials (or their designated 
     representatives), a summary of the comments of such 
     officials, a summary of the agency's evaluation of those 
     comments, and the agency's position supporting the need to 
     issue the regulation.
       The House amendment, in section 202, contains a similar 
     provision with those same requirements, except that it 
     applies to Federal mandates generally, and not just 
     intergovernmental mandates, and the costs of $100,000,000 
     shall be of expenditures by States, local governments, or 
     tribal governments, in the aggregate, or the private sector. 
     In addition, it requires that the statement identify the 
     provision of Federal law under which the rule is being 
     promulgated, the disproportionate budgetary effects of the 
     mandate on particular segments of the private sector, the 
     effect of private sector mandates on the national economy, 
     and the extent of the agency's prior consultation with 
     designated representatives of the private sector.
       The Conference substitute adopts the House provision, along 
     with a condition that the items in the written report be 
     included ``unless otherwise prohibited by law''. This section 
     does not require the preparation of any estimate or analysis 
     if the agency is prohibited by law from considering the 
     estimate or analysis in adopting the rule. Several other 
     modifications to the House provision were made by the 
     conferees. The rules to which the required statement applies 
     are any general notice of proposed rulemaking that is likely 
     to result in promulgation of any rule that includes a Federal 
     mandate, or any final rule for which such notice was 
     published. The substitute adds a requirement that there be a 
     qualitative and quantitative assessment of the anticipated 
     costs and benefits of the mandate, and an analysis of the 
     extent to which such costs may be paid with Federal financial 
     assistance. The requirement that the effect of private sector 
     mandates on the national economy be included is amended, so 
     that the limitation to ``private sector'' mandates is 
     stricken. The requirement that the statement include the 
     agency's position supporting the need to issue the regulation 
     containing the mandate is dropped. Also, the requirement for 
     a description of prior consultation drops both the reference 
     to ``designated representatives'' and to ``the private 
     sector'', and instead refers to the ``prior consultation with 
     elected representatives (under section 204)''.
       It is the intent of the conferees that the rulemaking 
     process shall follow the requirements of section 553 of title 
     5, United States Code, and shall be subject to the exceptions 
     stated therein. When a general notice of proposed rulemaking 
     is promulgated, such notice shall be accompanied by the 
     written statement required by section 202. When an agency 
     promulgates a final rule following the earlier promulgation 
     of a proposed rule, the rule shall be accompanied by an 
     updated written statement. In all cases, the exceptions 
     stated in section 553 shall apply, including for good cause.
     Sec. 203. Small government agency plan
       The Senate bill, in subsection 201(c), provides that before 
     establishing any regulatory requirements that might 
     significantly or uniquely affect small governments, agencies 
     shall have developed a plan under which the agency provides 
     notice to potentially affected small governments, enables 
     officials of such governments to provide input, and informs 
     and advises such governments on compliance with the 
     requirements. Such sums as are necessary to carry out these 
     requirements are authorized to be appropriated to each 
     agency.
       The House amendment, in subsection 201(c), contains an 
     identical provision.
       The Conference substitute retains this provision.
     Sec. 204. State, local and tribal government input
       The Senate bill, in subsection 201(b), requires each 
     agency, to the extent permitted in law, to develop an 
     effective process to permit State, local and tribal elected 
     officials (or their designated representatives) to provide 
     meaningful and timely input into the development of 
     regulatory proposals containing significant mandates. Such as 
     process shall be consistent with all applicable laws.
       The House amendment, in subsection 201(b), contains a 
     similar provision, but without the references to ``to the 
     extent permitted in law'' and ``consistent with all 
     applicable laws''.
       The Conference substitute requires each agency, to the 
     extent permitted in law, to develop an effective process to 
     permit elected officers (or their designated employees with 
     authority to act on their behalf) of State, local and tribal 
     governments to provide meaningful and timely input into the 
     development of regulations containing significant 
     intergovernmental mandates. It provides that the Federal 
     Advisory Committee Act (FACA) shall not apply to such 
     intergovernmental communications where the meetings are held 
     exclusively between Federal officials and elected State and 
     local officials (or their designated employees with authority 
     to act on their behalf) acting in their official capacities, 
     and where such meetings are solely to exchange views on the 
     implementation of Federal programs which explicitly share 
     intergovernmental responsibilities. The President shall issue 
     guidelines to agencies on the implementation of this 
     requirement, within 6 months.
       The conferees agree that an important part of efforts to 
     improve the Federal regulatory process entails improved 
     communications with State, local, and tribal governments. 
     Accordingly, this legislation will require Federal agencies 
     to establish effective mechanisms for soliciting and 
     integrating the input of such interests into the Federal 
     decision-making process. Where possible, these efforts should 
     complement existing tools, such as negotiated rulemaking and/
     or the use of Federal advisory committees broadly 
     representing all affected interests.
       The conferees recognize that FACA has been the source of 
     some confusion regarding the extent to which elected 
     officials of State, local, and tribal governments, or their 
     designated employees with authority to act on their behalf, 
     may meet with Federal agency representatives to discuss 
     regulatory and other issues involving areas of shared 
     responsibility. Section 204(b) clarifies Congressional intent 
     with respect to these interactions by providing an exemption 
     from FACA for the exchange or official views regarding the 
     implementation of public laws requiring shared 
     intergovernmental responsibilities or administration.
       Section 204(c) requires the President to issue guidelines 
     and instructions to Federal agencies, consistent with other 
     applicable laws and regulations, within six months of 
     enactment. The conferees would expect the President to 
     consult with the Director of the Office of Management and 
     Budget (OMB) and the Administrator of General Services (GSA) 
     before promulgating such guidelines.
     Sec. 205. Least burdensome option or explanation required
       The Senate bill contains no such provision.
       The House amendment, in subsection 201(d), prohibits an 
     agency from issuing a rule that contains a mandate if the 
     rulemaking record indicates that there are two or more 
     alternatives to accomplish the objective of the rule, unless 
     the mandate is the least costly method or has the least 
     burdensome effect, unless the agency publishes an explanation 
     of why the more costly or more burdensome method was adopted.
       The Conference substitute requires that before promulgating 
     any rule for which a written statement is required under 
     section 202, an agency shall identify and consider a 
     reasonable number of regulatory alternatives and select from 
     them either the least costly, the most cost-effective, or the 
     least burdensome alternative that achieves the objectives of 
     the rule, unless either the agency head publishes an 
     explanation of why this was not done or such a selection is 
     inconsistent with law. The conferees intend that ``a 
     reasonable number of regulatory alternatives'' means the 
     maximum number that an agency can thoroughly consider without 
     delaying the rulemaking process. The substitute also requires 
     the OMB Director, within one year of enactment, to certify 
     agency compliance with this section, and to include in the 
     written explanation any agencies and rulemakings that fail to 
     do so.
     Sec. 206. Assistance to the Congressional Budget Office
       The Senate bill, in section 203, provides that the OMB 
     Director shall collect from the agencies the statements 
     prepared under section 202 and periodically forward copies to 
     the CBO Director on a timely basis.
       The House amendment, in section 203, contains an identical 
     provision.
       The Conference substitute retains this provision.
     Sec. 207. Pilot program on small government flexibility
       The Senate bill, in section 204, requires the OMB Director 
     to establish pilot programs in at least two agencies to test 
     innovative and more flexibility regulatory approaches that 
     reduce reporting and compliance burdens on small governments, 
     while meeting overall statutory goals and objectives. Any 
     combination of proposed rules and rules in effect may be part 
     of the pilot programs.
       The House amendment, in section 204, contains an identical 
     provision.
       The Conference substitute retains this provision.
     Sec. 208. Annual statements to Congress on agency compliance 
         with requirements of title II
       The Senate bill contains no such provision.
       The House amendment, in section 207, provides that the OMB 
     Director shall annually submit written statements to 
     Congress, detailing agency compliance with the requirements 
     of its sections 201 (Regulatory Process) and 202 (Statements 
     to Accompany Significant Regulatory Actions).
       The Conference substitute adopts the House requirement and 
     applies it to compliance with all sections of this title.
     Sec. 209. Effective date
       The Senate bill, in section 205, provides that this title 
     shall take effect 60 days after the date of enactment.
       The House amendment would take effect upon enactment.
       The Conference substitute adopts the House effective date 
     of upon enactment.
                 Title III. Review of Federal Mandates

     Sec. 301. Baseline study of costs and benefits
       The Senate bill, in section 301, provides that within 180 
     days, the Advisory Commission on Intergovernmental Relations 
     (ACIR) shall begin a study of how to measure and 
     [[Page H3064]] define issues involved in calculating the 
     total direct and indirect costs and benefits to State, local, 
     and tribal governments of compliance with Federal law, and 
     the direct and indirect benefits to such governments of 
     Federal financial assistance and tax benefits. The study 
     shall deal with issues related to the feasibility of 
     measuring, and how to measure, such items.
       The House amendment contains no similar provision.
       The Conference substitute adopts the Senate language, 
     except that the study is to be completed within 18 months 
     rather than started within 180 days.
     Sec. 302. Report on Federal mandates by Advisory Commission 
         on Intergovernmental Relations
       The Senate bill, in section 302, requires ACIR to study the 
     role of unfunded Federal mandates in intergovernmental 
     relations, and to make recommendations regarding allowing 
     flexibility in complying with specific mandates, reconciling 
     conflicting mandates, terminating duplicative or obsolete 
     mandates, suspending mandates that are not vital to public 
     health and safety, consolidating or simplifying mandates, and 
     establishing common definitions or standards to be used in 
     complying with Federal mandate. To the extent practicable, 
     the specific unfunded mandate to which a recommendation 
     applies should be identified. One of the existing Federal 
     mandates that ACIR is to study and make specific 
     recommendations on is the Federal requirement that State, 
     local, and tribal governments utilize metric systems of 
     measurement. Within 60 days of enactment of this Act, ACIR is 
     required to issue proposed criteria under this subsection, 
     and then to allow 30 days for public comment, with adoption 
     of the final criteria not later than 45 days after the 
     issuance of the proposed criteria. Within 9 months of 
     enactment, ACIR is required to publish a preliminary report 
     on its activities under this title, including its 
     recommendations, and then to hold public hearings on these 
     preliminary recommendations. Not later than 3 months after 
     publication of the preliminary report, ACIR shall submit to 
     Congress and the President a final report on its findings, 
     conclusions, and recommendations under this section.
       The House amendment, in section 101, contains nearly 
     identical provisions, except that it also requires ACIR, when 
     studying the role of unfunded Federal mandates, to review 
     their impact on the competitive balance between State and 
     local governments, and the private sector, to review the role 
     of unfunded State mandates imposed on local governments and 
     the private sector, and to review the role of unfunded local 
     mandates imposed on the private sector. Definitions of 
     ``State mandate'' and ``local mandate'' are provided. It also 
     requires that ACIR make recommendations regarding the 
     establishment of procedures to ensure that when private 
     sector mandates apply to entities that compete with State or 
     local governments, any relief from unfunded Federal mandates 
     is applied in the same manner and the same extent to both. In 
     addition, ACIR is instructed to give highest priority to 
     mandates that are the subject of judicial proceedings between 
     the United States and a State, local, or tribal government. 
     The House amendment contains no provision regarding the 
     metric system of measurement.
       The Conference substitute retains the Senate provisions, 
     and adds the House requirements for a review of the impact on 
     competitive balance and a review of the role of unfunded 
     State mandates imposed on local governments (only), as well 
     as the provision placing highest priority on mandates that 
     are the subject of intergovernmental judicial proceedings. It 
     also includes a modification of a House requirement, so that 
     ACIR shall make recommendations on mitigating any adverse 
     impacts on the private sector that may result from relieving 
     State and local governments of mandates, and the feasibility 
     of applying relief from mandates in the same manner to both 
     the private sector, and State and local governments. The 
     House definition of ``State mandate'' is also retained. In 
     addition, a provision is added requiring that, to the extent 
     practicable, any negative impact on the private sector that 
     may result from implementation of a recommendation be 
     identified.
       The conferees intend that ACIR have flexibility to review a 
     wide array of federal requirements on State and local 
     governments. These requirements may include conditions of 
     federal assistance, such as those attached to the receipt of 
     Federal grants, or direct orders like emissions testing 
     requirements, carpool mandates, and national voter 
     registration directives that are not tied to the receipt of 
     Federal funds.
     Sec. 303. Special Authorities of Advisory Commission
       The Senate bill, in section 303, provides authority to the 
     ACIR, for purposes of carrying out this title, to procure 
     temporary and intermittent services of experts or 
     consultants, to receive on a reimbursable basis detailees 
     from Federal agencies, and to contract with and compensate 
     government and private persons for property and services.
       The House amendment, in section 102, contains the same 
     provisions, as well as a provision authorizing ACIR to 
     receive on a reimbursable basis administrative support 
     services from the General Services Administration.
       The Conference substitute adopts the House language.
     Sec. 304. Annual report to Congress regarding Federal court 
         rulings
       The Senate bill contains no such provision.
       The House amendment, in section 205, provides that ACIR 
     shall annually submit to Congress a report describing Federal 
     court rulings in the preceding your which imposed an 
     enforceable duty on one or more State, local, or tribal 
     governments.
       The Conference substitute modifies the House provision, by 
     requiring that the report describe any Federal court case to 
     which a State, local, or tribal government was a party in the 
     preceding year that required them to undertake 
     responsibilities beyond those they would otherwise have 
     undertaken, to comply with a Federal statute or regulation.
     Sec. 305. Definition
       The Senate bill contains no such provision.
       The House amendment, in section 103, defines, for purposes 
     of this title, ``Advisory Commission'' to mean the Advisory 
     Commission on Intergovernmental Relations, and ``Federal 
     mandate'' to mean any provision in statute or regulation or 
     any Federal court ruling that imposes an enforceable duty 
     upon States, local governments, or tribal governments 
     including a condition of Federal assistance or a duty arising 
     from participation in a voluntary Federal program.
       The Conference substitute retains the House definition of 
     ``Federal mandate'', but adds at the beginning of it the 
     phrase ``Notwithstanding section 3 of this Act,''.
     Sec. 306. Authorization of appropriations
       The Senate bill, in section 304, provides an authorization 
     of appropriations of $1,250,00 for each of fiscal years 1995 
     and 1996 to ACIR for the purposes of carrying out sections 
     301 and 302.
       The House bill provides no authorization of appropriations.
       The Conference substitute provides an authorization of 
     appropriations of $500,000 for each of fiscal years 1995 and 
     1996 to ACIR to carry out sections 301 and 302.
                  committee report on judicial review

       The purposes of Section 401 are as follows. Section 
     401(a)(1) and (2) would allow court review only to redress a 
     failure of an agency to prepare the written statement 
     (including the preparation of the estimates, analyses, 
     statements or descriptions) required to be included in such 
     statement under Section 202 or the written plan under Section 
     203(a)(1) and (2). A reviewing court may not review the 
     adequacy of a written statement prepared under Section 202 or 
     a written plan under Section 203(a) (1) and (2). Challenges 
     to an agency's failure to prepare a written statement under 
     Section 202 or a written plan under 203(a) (1) and (2) may be 
     brought only under Section 706(1) of the Administrative 
     Procedures Act and may not be brought until after a final 
     rule has been promulgated.
       Section 401(a)(3) prohibits any court in which review of a 
     completed rulemaking action is sought from staying, enjoying, 
     invalidating or otherwise affecting the effectiveness of an 
     agency's rulemaking for failure to comply with the 
     requirements of Section 202 and Section 203(a) (1) and (2) of 
     this Act. This is true not only under Section 401(a)(3), 
     which regards review of rules under other provisions of law, 
     but also under Section 401(a)(1), which only authorizes a 
     court to compel the agency to prepare a written statement, 
     but does not authorize a court to stay, enjoin, invalidate, 
     or otherwise affect a rule.
       It is the intent of the Conference Committee that if an 
     agency prepares the statements, analysis, estimates or 
     descriptions under Section 202 and the written plan under 
     Section 203(a) (1) and (2) for purposes of its rulemaking 
     pursuant to the underlying statute, a court may, if pursuant 
     to the review permitted under such statute, consider the 
     adequacy of such information generated. Section 401(a)(4) 
     provides that information generated under Section 202 and 
     Section 203(a) (1) and (2) is not subject to judicial review 
     pursuant to this Act under Section 706(2) of the 
     Administrative Procedures Act. Section 401(a)(4) does allow 
     that such information may, in accordance with the standards 
     and process of the underlying statute, be part of the 
     agency's rulemaking record subject to judicial review 
     pursuant to the underlying statute. Any such information that 
     is part of the record for judicial review pursuant to the 
     underlying statute. Any such information that is part of the 
     record for judicial review pursuant to the underlying statute 
     may be subject to review under Section 706(2) of the 
     Administrative Procedures Act (or other applicable law) and 
     can be considered by a court, to the extent relevant under 
     the underlying statute, as part of the entire record in 
     determining whether the record before it supports the rule 
     under the ``arbitrary and capricious'' or ``substantial 
     evidence'' standard (whichever is applicable). Pursuant to 
     the appropriate Federal law, a court should look at the 
     totality of the record in assessing whether a particular 
     rulemaking proceeding lacks sufficient support in the record. 
     The provisions of this Act do not change the standards of 
     underlying law, under which courts will review agency rules.
       Section 401(a)(5) provides that, for any action under 
     Section 706(1), the provisions of the underlying Federal 
     statute relating to all other matters, such as exhaustion of 
     remedies, statutes of limitations and venue, shall continue 
     to govern, notwithstanding 
     [[Page H3065]] the additional requirements on agencies that 
     Title II of this Act imposes. If, however, such underlying 
     Federal statutes does not have a statute of limitations that 
     is less than 180 days, then for review of agency rules under 
     Section 706(1) that include the requirements set forth in 
     Section 202 or Section 203(a) (1) and (2), the time for 
     filing an action under Section 706(1) is limited to 180 days.
       Finally, Section 401(b)(1) makes it clear that except as 
     provided in Section 401(a), no other provision or requirement 
     in the Act is subject to judicial review. Title I, those 
     portions of Title II not expressly referenced above, and 
     Title III are completely exempt from any judicial review. 
     Section 401(b)(2) states that, except as provided in Section 
     401(a), the Act creates no right or benefit that can be 
     enforced by any person in any action. Section 401(a)(6) 
     states that any agency rule for which a general notice of 
     proposed rulemaking has been promulgated after October 1, 
     1995 shall be subject to judicial review as provided in 
     Section 401(a)(2) (A) and (B).

                                                      U.S. Senate,


                                      Office of the Secretary,

                                                   March 10, 1995.
     Hon. Dirk Kempthorne,
     U.S. Senate,
     Washington, DC.
       Dear Senator Kempthorne: Per our conversation of March 9, 
     1995, I am writing to confirm that in the counting of days in 
     the U.S. Senate, a sine die adjournment will result in the 
     beginning again of the day counting process and that the sine 
     die adjournment of a Congress results in all legislative 
     action being terminated and any process ended so that it must 
     begin again in a new Congress.
       Hoping this may be of help. I remain,
           Sincerely,
                                                   Robert B. Dove,
                                     Parliamentarian, U.S. Senate.

     William F. Clinger,
     Rob Portman,
     David Dreier,
     Tom Davis,
     Gary Condit,
     Cardiss Collins,
     Edolphus Towns,
     Joe Moakley,
                                Managers on the Part of the House.

     Dirk Kempthorne,
     Bill Roth,
     Pete V. Domenici,
     John Glenn,
     J.J. Exon,
                               Managers on the Part of the Senate.
     

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