[Senate Report 104-15]
[From the U.S. Government Publishing Office]



   104th Congress 1st            SENATE                 Report
         Session
                                                        104-15
_______________________________________________________________________

                                     

                                                        Calendar No. 33
 
                   REGULATORY TRANSITION ACT OF 1995

                               __________

                              R E P O R T

                                 of the

                   COMMITTEE ON GOVERNMENTAL AFFAIRS
                          UNITED STATES SENATE

                              TO ACCOMPANY

                                 S. 219

                             TOGETHER WITH

                             MINORITY VIEWS

 TO ENSURE ECONOMY AND EFFICIENCY OF FEDERAL GOVERNMENT OPERATIONS BY 
  ESTABLISHING A MORATORIUM ON REGULATORY RULEMAKING ACTIONS, AND FOR 
                             OTHER PURPOSES




                 March 16, 1995.--Ordered to be printed
                   COMMITTEE ON GOVERNMENTAL AFFAIRS

 WILLIAM V. ROTH, Jr., Delaware, 
             Chairman
                                     TED STEVENS, Alaska
                                     WILLIAM S. COHEN, Maine
                                     FRED THOMPSON, Tennessee
                                     THAD COCHRAN, Mississippi
                                     CHARLES E. GRASSLEY, Iowa
                                     JOHN McCAIN, Arizona
JOHN GLENN, Ohio                     BOB SMITH, New Hampshire
SAM NUNN, Georgia
CARL LEVIN, Michigan
DAVID PRYOR, Arkansas
JOSEPH I. LIEBERMAN, Connecticut
DANIEL K. AKAKA, Hawaii
BYRON L. DORGAN, North Dakota
 Franklin G. Polk, Staff Director 
         and Chief Counsel
         Paul Noe, Counsel
  Leonard Weiss, Minority Staff 
             Director
  Michal Sue Prosser, Chief Clerk


                            C O N T E N T S

                              ----------                              
                                                                   Page
  I. Summary..........................................................1
 II. Background.......................................................3
III. Legislative History and Committee Consideration..................5
 IV. Section-By-Section Analysis.....................................12
  V. Regulatory Impact of Legislation................................21
 VI. Cost Estimate of Legislation....................................22
VII. Minority Views..................................................25
VIII.
     Changes in Existing Law.........................................33
                                                        Calendar No. 33
104th Congress                                                   Report
                                 SENATE

 1st Session                                                     104-15
_______________________________________________________________________


                   REGULATORY TRANSITION ACT OF 1995

                                _______


                 March 16, 1995.--Ordered to be printed

_______________________________________________________________________


  Mr. Roth, from the Committee on Governmental Affairs, submitted the 
                               following

                              R E P O R T

                             together with

                             MINORITY VIEWS

                         [To accompany S. 219]

    The Committee on Governmental Affairs, to which was 
referred the bill (S. 219) to ensure economy and efficiency of 
Federal Government operations by establishing a moratorium on 
certain significant regulatory actions, and for other purposes, 
having considered the same, reports favorably thereon with an 
amendment in the nature of the substitute and recommends that 
the bill as amended do pass.

                               i. summary

    The Regulatory Transition Act of 1995 (``the Act'') 
establishes a moratorium on regulatory rulemaking actions by 
most agencies of the Federal Government, covering rulemakings 
between November 9, 1994 and December 31, 1995, unless an Act 
of Congress provides an earlier termination date. It is 
intended that comprehensive regulatory reform legislation will 
provide an earlier termination date. On the date of enactment, 
agencies are prohibited from taking most significant regulatory 
actions until the end of the moratorium period. In addition, 
thirty days after enactment, the effectiveness of any 
regulatory rulemaking action taken during the moratorium 
period, but before the date of enactment, is suspended until 
the end of the moratorium period.
    ``Significant rulemaking action'' is defined in the Act so 
that many agency actions, such as substantive rules 
interpretive rules, statements of agency policy, guidances, 
guidelines, or notices of proposed rulemaking, are potentially 
covered by the moratorium. In conformity with Executive Order 
12866, those significant rulemaking actions are further limited 
to agency actions that the Administrator of the Office of 
Information and Regulatory Affairs finds: (i) has an annual 
effect on the economy of $100,000,000 or more or adversely 
affects in a material way the economy, a sector of the economy, 
productivity, competition, jobs, the environment, public health 
or safety, or State, local, or tribal governments or 
communities; (ii) creates a serious inconsistency or otherwise 
interferes with an action taken or planned by another agency; 
(iii) materially alters the budgetary impact of entitlements, 
grants, user fees, or loan programs or the rights and 
obligations of recipients thereof; or (iv) raises novel legal 
or policy issues arising out of legal mandates, the President's 
priorities, or the principles set forth in Executive Order 
12866.
    The bill does not prohibit agencies during the moratorium 
period from conducting cost/benefit analysis or risk assessment 
on regulations; nor does it prevent the public from providing 
comments to agencies on pending regulations.
    The bill provides for exceptions to the moratorium in two 
distinct ways. Minor, specific exceptions are made by narrowing 
the definitions of a ``rule'' to exclude items such as certain 
regulations on railroad crossings or regulations relating to 
the safety and soundness of depository institutions. Exclusions 
from the definition of ``rule'' are self-executing. But the 
authority for major exceptions, those most commonly discussed, 
is not self-executing. Rather, a process is established whereby 
the appropriate agency petitions the President who is given 
discretion to decide whether regulations in various areas are 
to be excepted from the moratorium. These areas include 
imminent threats to health and safety, the criminal laws, 
military affairs, international trade, internal revenue laws, 
and other matters.
    Although the legislation provides the President discretion 
to exempt certain regulations and shields his determinations 
from judicial review, it is not intended that the President's 
authority be co-extensive with all significant regulatory 
actions. Thus, his authority to exempt regulations on health 
and safety, for example, generally is limited to those 
regulations that address an ``imminent threat''. Since so many 
of the covered regulations arguably might be somehow relevant 
to health and safety concerns, the absence of such limitations 
might allow the President to except virtually any regulation, 
no matter how remotely related to health or safety.
    Because many agencies face statutorily or judicially 
imposed deadlines for the promulgation of regulations, the Act 
extends all such deadlines for five months beyond the end of 
the moratorium period. The Act also requires the President to 
publish a list of all such deadlines in the Federal Register.
    Since the moratorium is intended to be in effect only for a 
short period of time, the bill provides that no determination 
under the Act is subject to adjudicative review before any 
tribunal or court of law.
    In reaction to the public outcry against ever increasing 
regulatory burdens, several Senate committees are presently 
considering comprehensive reform of the regulatory process. In 
view of the large number of significant rules in the pipeline, 
the Committee believes that they should be suspended long 
enough to allow the reform legislation's requirements to apply 
to them. That is the purpose of the reported legislation.

                             ii. background

    The congressional elections on November 8, 1994, were a 
watershed in the relationship between the American people and 
their government. The public sent a clear message to Washington 
that they want a smaller, more efficient, and more effective 
government. This message reflects a deep and growing resentment 
about the rising costs of federal regulations, and their 
intrusiveness into the lives of most Americans.
    Although many regulations provide important protections and 
benefits to the public, it is clear that the regulatory process 
is broken. Many regulations impose undue costs, and the 
regulatory process itself is ossified, unresponsive, and 
inefficient. The cumulative cost of regulation is enormous and 
is rising at an alarming rate. Professor Thomas Hopkins 
conservatively estimated the annual cost of federal regulations 
at $560 billion for 1992; it is expected to rise another $100 
billion by the end of this decade. Although generally imposed 
on businesses and governments, regulations act as hidden taxes 
on the American consumer and taxpayer through higher prices, 
diminished wages, increased taxes, or reduced government 
services. This hidden tax amounts to about $6,000 per year for 
the average American household.\1\ Our nation cannot afford to 
ignore the need to reform the regulatory process to ensure that 
agencies seriously consider whether regulations are justifiable 
and rational. If agencies decide to issue regulations, they 
should do so in a smarter, more cost-effective manner.
    \1\ See Thomas D. Hopkins, ``Costs of Regulation: Filling the 
Gaps'' (Rep. Prepared for Reg. Info. Service Center) (Aug. 1992).
---------------------------------------------------------------------------
    This history of regulation in America, as well as 
Congressional and Presidential efforts to control it, is well 
documented and does not need to be repeated here in full 
detail.\2\ What is important to recount is the recent history 
of Executive Branch efforts to reform the regulatory process. 
Because these efforts have failed to produce significant 
lasting regulatory reform, this Committee believes it is now 
time for Congress to take firm action.
    \2\ The last significant attempt by Congress to reform the 
regulatory process was in 1981, with the Senate's consideration of 
Senate Bill 1080. The Senate Judiciary Committees Report on the bill is 
an excellent source of information. See Senate Report No. 97-284.
---------------------------------------------------------------------------
    President Richard Nixon established the first modern 
regulatory review program, entitled the Quality of Life review 
(QOL). Under QOL, agencies were required to consider various 
regulatory alternatives and their costs when developing 
``significant'' regulations. The proposed and final regulations 
were submitted to OMB, which circulated them to other agencies 
for comment.
    President Gerald Ford continued the QOL review when he 
assumed office in 1974. Concerned about inflation, he also 
issued Executive Order 11821 (E.O. 11821), requiring agencies 
to prepare inflationary impact statements for all major 
regulations. E.O. 11821 directed OMB to develop criteria for 
identifying major regulations and to prescribe procedures for 
their evaluation.
    President Jimmy Carter's Executive Order 12044 extended 
president Ford's efforts to reduce the costs of regulations by 
revising rulemaking procedures. E.O. 12044 directed agencies to 
identify ``significant'' regulations imposing costs on the 
economy of $100 million or more per year or causing a major 
increase in costs or prices to various groups or regions, and 
to prepare a cost/benefit analysis for such regulations. 
Despite these efforts, the number of new federal regulations 
spiralled higher than ever, reaching an all-time record high of 
73,258 pages in the Federal Register during the last year of 
the Carter Administration.
    To stem the rising tide of regulations, President Ronald 
Reagan issued Executive Order 12291 shortly after taking 
office. This Order incorporated and expanded upon the key 
provisions of E.O. 12044, including a review of existing 
regulations, selecting the least costly regulatory alternative 
when developing new regulations, and requiring agencies to 
prepare regulatory cost/benefit analyses (termed regulatory 
impact statements) for major regulations. President Reagan 
directed agencies to develop regulations only if there was a 
clear need, the benefits outweighed the costs, and the least 
costly alternative was chosen. Most importantly, E.O. 12291 
centralized review and clearance of regulatory actions in OIRA 
within OMB. Agencies had to respond to OMB comments and 
incorporate those comments and the agencies responses in the 
rulemaking file before issuing a final regulation. For the 
first time, no regulations could be promulgated unless they 
were first approved by one central clearinghouse. President 
Reagan also issued Executive Order 12498 in March 1985, 
directing agencies to prepare a yearly agenda containing all 
contemplated regulatory actions for the coming year. Except for 
emergency situations, agencies were prohibited from taking any 
significant regulatory actions that had not been included in 
the agenda, unless those actions were cleared through by OMB. 
President Reagan's efforts proved successful, at least 
temporarily. By 1986, the number of new regulations being 
published in the Federal Register had been reduced to 44,812 
pages.
    President George Bush continued President Reagan's 
Executive Orders when he took office in 1989. Concerned about 
the continuing increase in the cost of regulations, however, he 
established the President's Council on Competitiveness in March 
1989 to oversee regulatory issues. Chaired by Vice President 
Dan Quayle, the Council focused on reducing the cost of new and 
existing regulations. In January 1992, President Bush issued a 
90-day moratorium on new regulations. During the moratorium, 
agencies were directed to identify existing regulations 
imposing unnecessary regulatory burdens and to develop programs 
to reduce or eliminate those burdens. The moratorium was later 
extended through the rest of President Bush's term in office.
    On October 4, 1993, President Bill Clinton issued Executive 
Order 12866, revoking prior Executive Orders, but incorporating 
or restating some of the key provisions from those prior 
orders. And President Clinton has continued President Bush's 
efforts to make the Vice President a central figure in the 
regulatory process.
    The case for enacting a regulatory moratorium is this: 
Regulations have grown dramatically in number and complexity 
over the recent past, and there are strong signs they will 
continue to grow.
    Regulations can also be measured by the costs they impose 
on the American people. The Clinton Administration has 
estimated that federal regulations cost the private sector 
alone ``at least $430 billion per year--9 percent of our gross 
domestic product.'' \3\ Other conservative estimates put the 
private sector cost of regulation at over $580 billion per 
year--and rising.\4\ Regulations are costly to the federal 
government as well.\5\
    \3\ Vice President Al Gore, ``From Red Tape to Results: Creating a 
Government that Works Better & Costs Less,'' Report of the National 
Performance Review, Sept. 7, 1993, at 32.
    \4\ Thomas D. Hopkins, ``Costs of Regulations: Filling the Gaps'' 
(Rep. prepared for Reg. Info. Service Center) Table 2 (Aug. 1992) 
(estimate for 1933, in 1991 dollars).
    \5\ See The Heritage Foundation, ``A Citizens Guide to 
Regulation,'' at 1 (edited by S. Eckerly, Sept. 1994).
---------------------------------------------------------------------------
    As taxpayers, the American people have a right to ask 
whether they are getting their money's worth. Currently, too 
few regulations are subjected to stringent cost/benefit 
analysis or risk assessment based on sound science. Without 
such protections, regulations can have unintended results.
    Without significant new controls, the volume of regulations 
will only grow larger. In a recent Presidential publication, 
the Administration listed 4,300 additional rulemakings 
scheduled for fiscal year 1995 and beyond, with 872 final rules 
set to be released in the six months between October 1994 and 
April 1995. \6\
    \6\ See Regulatory Plan and Unified Agenda of Federal Regulations, 
(Nov. 14, 1994).
---------------------------------------------------------------------------
    In light of the significant but largely unsuccessful 
efforts of the Executive branch to control the regulatory 
process, major substantive reform is now high on the agenda of 
the 104th Congress. In order to implement needed reform, 
however, it is important to temporarily put a ``hold'' on the 
promulgation of new regulations by passing the Regulatory 
Transition Act of 1995. There are at least two clear benefits 
to this Act. First, a moratorium will provide both the 
executive and the legislative branches (as well as the 
regulated public) with more time to focus on ways to fix 
current regulations and the regulatory system. Everyone 
involved in the regulatory process will be largely freed from 
the daily burden of having to review, consider and correct 
newly promulgated regulations (which currently average over 200 
pages every working day). Second, regulations will be 
temporarily suspended and re-evaluated to ensure they can pass 
the new standards that will emerge with substantive regulatory 
reform.

          III. LEGISLATIVE HISTORY AND COMMITTEE CONSIDERATION

    Just before the 104th Congress convened, the idea for a 
moratorium on new regulations was proposed as a Presidential 
Executive Order. On December 12, 1994, Republican leaders of 
the House and Senate asked President Clinton to voluntarily 
impose a moratorium on all federal rulemaking for the first 100 
days of Congress (see letter in appendix). They asked the 
President to direct agencies to: (1) identify regulations in 
which the costs exceed the benefits; (2) recommend actions to 
eliminate unnecessary regulatory burdens; (3) recommend ways to 
give state, local and tribal governments more flexibility to 
meet federal mandates; and (4) share their information and 
analysis with Congress.
    Two days later, the President responded (see letter in 
appendix). The Administration disputed Congress belief that a 
moratorium was the best way to proceed with regulatory reform.
    After the President rejected a voluntary moratorium, 
Senator Don Nickles (R-OK), along with 34 other co-sponsors, 
introduced the Regulatory Transition Act of 1995 on January 12, 
1995.

Committee hearings

    On Tuesday, February 7, 1995 at 10:00 a.m., the Committee 
on Governmental Affairs met pursuant to notice. The purpose of 
the hearing was to receive testimony form members of the Senate 
on S. 219, the Regulatory Transition Act of 1995, as well as on 
proposals to reform the regulatory process.
    The Honorable Don Nickles (R-OK), the sponsor of S. 219, 
testified in support of his bill. He stated that the first step 
to reforming the regulatory process was to put a hold on new 
regulations so that they can be reviewed and questioned for 
their necessity. He recounted that on December 12, 1994, the 
Republican leadership of the House and Senate wrote to 
President Clinton and requested that he impose a moratorium on 
new regulations. The Administration rejected the request, and 
ignored the health and safety exceptions suggested in the 
letter and raised the emotional examples of regulations dealing 
with ``tainted meat'' and ``Desert Storm Syndrome.''
    Senator Nickles stated that the purpose of the temporary 
moratorium is to give Congress enough time to pass legislation 
to comprehensively change the regulatory process. He stated 
that he was pleased to join Senator Dole in introducing S. 343, 
the ``Comprehensive Regulatory Reform Act.'' Senator Nickles 
also noted that he introduced S. 348, the ``Regulatory 
Oversight Act of 1995,'' to provide a 45-day review period for 
Congress to enact a joint resolution to reject any final 
regulation.
    Senator Hutchison, a co-sponsor of S. 219, spoke strongly 
in favor of the bill. She emphasized the need for swift action 
on the moratorium and noted that the bill contains an exemption 
for regulations designed to address harm to people.
    On Wednesday, February 22, at 10:00 a.m., this Committee 
held another hearing on S. 219 at the request of the minority. 
Before the hearing, on the Friday, February 17, the staff of 
Senator Nickles made available a revised draft of S. 219, which 
they designed to address concerns raised about the original 
bill. (A modification of this draft was used by the Committee 
in marking up the legislation.)
    The Honorable Sally Katzen, Administrator, Office of 
Information and Regulatory Affairs (OIRA), Office of Management 
and Budget, testified in opposition to the bill. She said she 
believed regulations were not inherently good or bad, but 
rather had the potential to be either. She testified that 
excessive or poorly designed regulations can cause confusion 
and delay and generate unreasonably burdensome compliance 
costs. She also stated, however, that they can assure equal 
access to markets, limit pollution, and provide other benefits 
to society. She said she opposed S. 219 because it would stop 
good regulations as well as bad ones, and substitute an 
arbitrary administrative process for substantive improvements. 
She also raised a number of questions about the definitions and 
exemptions in the bill. However, she also stated that she had 
not reviewed the revised draft of S. 219 prepared by the staff 
of Senator Nickles.
    Mr. Stephen Kaplan, the General Counsel of the Department 
of Transportation, stated that he strongly believed that 
imposing a moratorium, such as that suggested by S. 219, may 
cause damage to those it is intended to help, and will result 
in unnecessary and unintended injuries and loss of life.
    Mr. William Schultz, the Deputy Commissioner for Policy, 
Food and Drug Administration, stated that S. 219 would 
seriously impede the ability of the FDA to take appropriate 
action to reduce or eliminate risks to public health. He 
provided examples of regulations he believed could be affected 
by the moratorium.
    Mr. C. Boyden Gray, Chairman of Citizens for a Sound 
Economy and Partner, Wilmer Cutler & Pickering, testified in 
support of S. 219 and of a timeout on regulations. He stated 
that in 1981 and again in 1992, a timeout on issuing 
regulations had permitted the White House to tell the agencies 
to review the regulations being promulgated. He stated that he 
was not aware of any great public health or safety difficulties 
arising out of either of those moratoria. Mr. Gray further 
stated that he did not believe that many of the regulations 
cited at the hearing by opponents of the moratorium would be 
stopped by S. 219. He also stated that a regulatory moratorium 
would not be so difficult to manage and would provide an 
important time-out to review existing regulations. He noted 
that the moratorium would capture many unduly expensive rules 
and that, in particular, EPA's California Car Rule and Enhanced 
Monitoring Rule were extremely burdensome.
    Mr. Thomas J. Donohue, President and Chief Executive 
Officer, American Trucking Associations, Inc., testified in 
support of S. 219. He said that he believes that a moratorium 
on federal rules is necessary while setting up a system that 
would allow for cost/benefit analysis and risk assessment of 
regulations. He stated that, as an example, rules for pre-
employment and random alcohol testing of truck drivers would 
cost the trucking industry $250,000,000 in one year, even 
though in a random test only .2% of truck drivers failed a .02% 
alcohol standard. In addition, he cited as another example of 
undue and burdensome regulations to which the moratorium is 
properly directed as the Occupational Safety and Health 
Administration's (OSHA's) upcoming ergonomics proposal. He said 
this rule might well require that trucks be steered in a 
different way or might prevent workers from lifting more than 
25 pounds. He said that the rules were not cost-effective.
    Mr. Dean McGrath, Senior Attorney with the American 
Automobile Manufacturer's Association, testified in support of 
S. 219. He said that the auto industry, as one of the most 
heavily regulated industries in the country, can name many 
examples of good legislative intentions gone awry. In 
particular, Mr. McGrath supported the fact that the moratorium 
would suspend the EPA approved petition submitted by the 
Northern States and the District of Columbia that would mandate 
the adoption of California's auto emissions program in the 
Northeastern States. Mr. McGrath also said that the AMAA 
supported S. 219's exception for regulations dealing with 
imminent threats to health and safety and other emergencies. 
Finally, he supported applying the moratorium retroactively. He 
believed that this would address the concern that has been 
expressed that some rules were issued simply to avoid contrary 
direction from the new Congress. He said that he believed that 
limiting this potential ``political'' perception problem could 
only enhance the integrity of the regulatory process.
    Mr. Sal Risalvato, owner of Riverdale Texaco, Riverdale, 
New Jersey, testified that government regulation had cost him 
and his business thousands of dollars. He said he had spent 
$95,000 making adjustments to new tanks in order to comply with 
environmental regulations. He also said federal regulators were 
trying to force New Jersey to perform new emissions inspections 
that would cause him to purchase equipment costing from $35,000 
to $100,000. He said he believed the moratorium period would 
allow the Committee to look at regulatory reforms, and that he 
believed a longer moratorium was needed.
    Mr. Rainer Mueller, a private citizen and founder of Safe 
Tables Our Priority (STOP), testified in opposition to S. 219. 
He stated that his son Eric Mueller died as a result of eating 
meat contaminated with E. coli bacteria. Mr. Mueller stated 
that a new meat inspection rule which could have prevented his 
son's death would be stopped by this legislation. Specifically 
he referred to the USDA proposed Hazardous Analysis Critical 
Control Point (HACCP) regulations to improve meat and poultry 
inspection. Under HACCP, likely hazards in a production system 
are regularly monitored on the basis of risk. Risks are 
identified, their controls determined and monitored, and end 
products are periodically sampled to check the HACCP process. 
Mr. Mueller stated that S. 219 would freeze this regulation, 
effectively maintaining what he believes is an outdated and 
broken meat and poultry inspection system.
    Mr. David G. Hawkins, Senior Attorney with the Natural 
Resources Defense Council, testified in opposition to S. 219. 
He stated that a moratorium was the wrong tool for better 
regulation. He said a moratorium would delay important public 
protections, such as child-resistant packaging, and would lead 
to many deaths. He emphasized that the fundamental flaw of a 
moratorium is that it would prevent the adoption of beneficial 
rules. Mr. Hawkins noted that the focus of the Senate 
moratorium bill is on big rules, but that only guarantees that 
the moratorium will stall many rules that would have provided 
big benefits to the public. He stated that the rules on 
municipal waste incinerators and medical waste incinerators, 
for example, could reduce 200,000 tons of toxic emissions 
annually but would be blocked by the moratorium.
    Mr. Hawkins also noted that significant rules are the most 
closely analyzed rules under President Clinton's Executive 
Order 12866. He questioned the value of delaying the very rules 
that receive the most analysis. He also forecasted that S. 219 
would encourage OMB not to classify rules as significant to 
avoid the moratorium. Those rules then would not receive close 
scrutiny under E.O. 12866.
    Finally, Mr. Hawkins stated that the section 7 of S. 219 
does not adequately foreclose judicial review. He said the 
revised language would not preclude judicial review in a 
challenge to a final rule. He also stated that S. 219 makes a 
rule already proposed an illegality. He stated that the 
retroactive effect of the moratorium will have unpredictable 
impacts on existing contracts, business relations, and the 
economy.

Amendments and Committee action

    On March 7, 1995 and on March 9, 1995, the Committee on 
Governmental Affairs marked up the bill and on March 9 reported 
the bill, as amended, on a roll call vote of 6 Ayes and 5 Nays. 
Voting in the affirmative were Senators Roth, Cohen, Thompson, 
Cochran, Grassley, and Smith. In addition, Senators Stevens and 
McCain voted in the affirmative by proxy. Negative votes were 
cast by Senators Glenn, Levin, Lieberman, Akaka, and Dorgan. 
Senators Nunn and Pryor were noted by proxy as being opposed.
    Moreover, a number of amendments were offered, debated and 
voted upon, including the following:
    Accepted:
    (1) Roth Substitute for S. 219 (voice vote):
          Limits moratorium to ``significant regulatory action 
        taken during the moratorium period'' (no longer action 
        ``made effective'' during the moratorium);
          Extends moratorium period to ``time beginning 
        November 9, 1994, and ending on December 31, 1995, 
        unless an Act of Congress provides for an earlier 
        termination date for such a period.''
          Limits judicial review language to ``No determination 
        under this Act shall be subject to adjudicative review 
        before an administrative tribunal of court of law.''
    (2) Cochran amendment to exempt ``any action taken to 
ensure the safety and soundness of a Farm Credit System 
institution or to protect the Farm Credit Insurance Fund.'' 
(voice vote)
    (3) Pryor amendment to exempt ``any agency action that 
establishes, modifies, opens, closes, or conducts a regulatory 
program for a commercial, recreational, or subsistence activity 
relating to hunting, fishing, or camping, if a Federal law 
prohibits such activity in the absence of agency action.'' 
(voice vote)
    (4) Akaka amendment to exempt ``the promulgation of any 
rule or regulation relating to aircraft overflights on national 
parks, except those in Alaska, by the Secretary of 
Transportation or the Secretary of Interior pursuant to the 
procedures specified in the advanced notice of proposed 
rulemaking published on March 17, 1994, at 59 Fed. Reg. 12740 
et seq.'' (voice vote)
    (5) Levin amendment to exempt ``any significant regulatory 
action which establishes or enforces any statutory rights that 
prohibit discrimination on the basis of race, religion, sex, 
age, national origin or handicapped or disability status.'' 
(voice vote)
    (6) Glenn amendment to exempt ``any regulatory action to 
improve safety, including such an action to improve 
airworthiness of aircraft engines.'' (voice vote)
    (7) Glenn amendment to exempt ``any regulatory action that 
would upgrade safety and training standards for commuter 
airlines to those of major airlines.'' (voice vote)
    (8) Glenn amendment to exempt ``any regulatory action by 
the Environmental Protection Agency that would protect the 
public from exposure to lead from house paint, soil or drinking 
water.'' (voice vote, 3/9)
    (9) Thompson amendment to exempt ``any clarification of 
existing responsibilities regarding highway safety warning 
devices'' (intended to cover railroad crossings). An amendment 
that would clarify existing responsibilities regarding highway 
safety warning devices so as to promote safety, and would allow 
a proposed Department of Transportation rule to go forward for 
public comment. (voice vote)
    (10) McCain amendment to exempt actions ``limited to 
matters relating to negotiated rulemaking carried out between 
Indian tribal governments and that agency under the `Indian 
Self-Determination Act Amendments of 1994 (Public Law 103-
413)'.'' (voice vote)
    (11) Grassley amendment to include in the moratorium 
actions to ``carry out the Interagency Memorandum of Agreement 
Concerning Wetlands Determinations for Purposes of Section 404 
of the Clean Water Act and Subtitle B of the Food Security Act 
(59 Fed. Reg. 2920); or any method of delineating wetlands 
based on the Memorandum of Agreement for purposes of carrying 
out subtitle C of title XII of the Food Security Act of 1985 
(16 U.S.C. 3821 et seq.) or section 404 of the Federal Water 
Pollution Control Act (33 U.S.C. 1344).'' (voice vote)
    (12) Stevens amendment to extend the moratorium to include 
any action that ``withdrawals or restricts recreational, 
subsistence, or commercial use of any land under control of a 
Federal agency, except'' with respect to ``military or foreign 
affairs or international trade'' or ``principally related to 
agency organization, management, or personnel'', and to define 
``public property'' as ``all property under the control of a 
Federal agency, other than land'' (in order to preclude any 
Presidential exemptions of public land rules under the public 
property exemption in Section 5(F) (accepted 8-5) Voting in the 
affirmative were Senator Roth, Stevens, Thompson (by proxy), 
Cochran, Grassley (by proxy), McCain (by proxy), Smith (by 
proxy) and Dorgan. Negative votes were cast by Senators Glenn, 
Nunn, Levin, Lieberman (by proxy), and Akaka (by proxy).
    (13) Glenn amendment to exempt ``any regulatory action to 
provide compensation to Persian Gulf War Veterans for 
disability from undiagnosed illnesses, as provided by the 
Persian Gulf War Veterans' Benefit Act.'' (accepted 8-6) Voting 
in the affirmative were Senators Glenn, Nunn, Levin (by proxy), 
Pryor (by proxy), Lieberman, Akaka (by proxy), Dorgan (by 
proxy) and Smith. Negative votes were cast by Senators Roth, 
Cohen, Thompson (by proxy), Cochran, Grassley (by proxy), and 
McCain (by proxy).
    Rejected:
    (1) Glenn amendment to exempt ``any regulatory action to 
reduce pathogens in meat and poultry taken by the Food Safety 
and Inspection Service of the U.S. Department of Agriculture, 
including Hazardous Analysis Critical Control Point (HACCP) 
regulations.'' (rejected 7-7) Voting in the affirmative were 
Senators Glenn, Nunn (by proxy), Levin, Pryor (by proxy), 
Lieberman (by proxy), Akaka, Dorgan (by proxy). Negative votes 
were cast by Senators Roth, Stevens (by proxy), Thompson (by 
proxy), Cochran (by proxy), Grassley, McCain (by proxy), and 
Smith (by proxy).
    (2) Glenn amendment to exempt ``any regulatory action by 
the Environmental Protection Agency that relates to control of 
microbial and disinfection byproduct risks in drinking water 
supplies.'' (rejected 7-8) Voting in the affirmative were 
Senators Glenn, Nunn (by proxy), Levin, Pryor (by proxy), 
Lieberman (by proxy), Akaka (by proxy), and Dorgan. Negative 
votes were cast by Senators Roth, Stevens (by proxy), Cohen, 
Thompson (by proxy), Cochran (by proxy), Grassley, McCain, and 
Smith.
    (3) Glenn amendment to exempt ``any regulatory actions to 
ensure safe and proper disposal of radioactive waste, as well 
as any action regarding decontamination and decommissioning of 
NRC-licensed sites. (rejected 7-8) Voting in the affirmative 
were Senators Glenn, Nunn (by proxy), Levin (by proxy), Pryor 
(by proxy), Lieberman (by proxy), Akaka, and Dorgan, Negative 
votes were cast by Senators Roth, Stevens (by proxy), Cohen (by 
proxy), Thompson (by proxy), Cochran, Grassley, McCain (by 
proxy), and Smith.
    (4) Levin amendment to exempt ``any significant regulatory 
action the principal purpose of which is to protect or improve 
human health or safety and for which a cost-benefit analysis 
has been completed and the head of the agency taking such 
action has concluded to the extent permitted by law that the 
benefits justify the costs.'' (rejected 7-7) Voting in the 
affirmative were Senators Glenn, Nunn (By proxy), Levin, Pryor 
(by proxy), Lieberman (by proxy), Akaka, and Dorgan (by proxy). 
Negative votes were cast by Senators Roth, Stevens (by proxy), 
Thompson (by proxy), Cochran (by proxy), Grassley, McCain (by 
proxy), and Smith.
    (5) Levin amendment to:
          Eliminate retroactivity of the moratorium, making the 
        period ``from the date of enactment of this Act until 
        December 31, 1995'' (rather than starting on November 
        9, 1994);
          Require the President to ``publish in the Federal 
        Register a list of all rules covered by [the 
        moratorium]'' (a one-time reporting rather than a 
        monthly reporting requirement); and
          Limit the moratorium to significant, final rules (no 
        longer extending the moratorium to a ``substantive 
        rule, interpretative rule, statement of agency policy, 
        guidance, guidelines, or notice of proposed 
        rulemaking''). (rejected, 7-8) Voting in the 
        affirmative were Senators Glenn, Nunn, Levin, Pryor (by 
        proxy), Lieberman (by proxy), Akaka (by proxy), and 
        Dorgan (by proxy). Negative votes were cast by Senators 
        Roth, Stevens (by proxy), Cohen, Thompson (by proxy), 
        Cochran (by proxy), Grassley, McCain, and Smith.
    (6) Levin amendment to exempt any deadlines from the 
moratorium that are statutorily or judicially mandated. (The 
amendment deletes ``Section 4. Special Rule on Statutory, 
Regulatory, and Judicial Deadlines''). (rejected 7-8) Voting in 
the affirmative were Senators Glenn, Nunn, Levin, Pryor (by 
proxy), Lieberman (by proxy), Akaka (by proxy), and Dorgan. 
Negative votes were cast by Senators Roth, Stevens (by proxy), 
Cohen, Thompson (by proxy), Cochran (by proxy), Grassley, 
McCain, and Smith.
    (7) Levin amendment to delete the five month extension of 
the moratorium for deadlines. (The current bill states that 
``any deadline for . . . any significant regulatory action . . 
. is extended for 5 months or until the date occurring 5 months 
after the end of the moratorium, whichever is later.'') 
(rejected 7-8) Voting in the affirmative were Senators Glenn, 
Nunn, Levin, Pryor (by proxy), Lieberman, Akaka (by proxy), and 
Dorgan. Negative votes were cast by Senators Roth, Stevens (by 
proxy), Cohen, Thompson (by proxy), Cochran (by proxy), 
Grassley, McCain, and Smith.
    (8) Levin amendment to exempt ``any significant regulatory 
action which is the consensual product of regulatory 
negotiation pursuant to the Regulatory Negotiation Act.'' 
(rejected 7-8) Voting in the affirmative were Senators Glenn, 
Nunn (by proxy), Lieberman, Akaka, and Dorgan. Negative votes 
were cast by Senators Roth, Stevens (by proxy), Cohen (by 
proxy), Thompson (by proxy), Cochran, Grassley, McCain (by 
proxy), and Smith.
    Tabled:
    (1) Levin amendment to exempt ``any significant regulatory 
action which enforces constitutional rights of individuals.'' 
(Table 8-7) Voting in the affirmative were Senators Roth, 
Stevens (by proxy), Cohen (by proxy), Thompson (by Proxy), 
Cochran (by proxy), Grassley, McCain (by proxy), and Smith. 
Negative votes were cast by Senators Glenn, Nunn (by proxy), 
Levin, Pryor (by proxy), Lieberman (by proxy), Akaka, and 
Dorgan (by proxy).

                    iv. section-by-section analysis

Section 1. Short title

    The name of the Act is the ``Regulatory Transition Act of 
1995''.

Section 2. Finding

    The purpose of the legislation is to promote effective 
measures for greater efficiency and proper management in 
government operations. These efforts include the steps being 
taken by Congress to enact (A) requirements for cost/benefit 
analysis and (B) requirements for standardized risk analysis 
and risk assessment that use the best scientific and economic 
procedures, in the case of those federal regulations which are 
subject to risk analysis and risk assessment.

Section 3. Moratorium on regulations

    Section 3(a) establishes a moratorium on federal 
significant regulatory actions that are not otherwise excepted 
or excluded under other provisions of the Act. Because the 
moratorium begins November 9, 1994 and may end December 31, 
1995, the operative provisions of this subsection first direct 
that any federal agency may not take any significant rulemaking 
action beginning on the date of the enactment of the Act.
    Because some time will have elapsed from November 9, 1994 
until the enactment of the legislation, the Act also provides 
that, beginning on the thirtieth day following enactment, any 
regulatory rulemaking action that was taken or made effective 
between November 9, 1994 and the date of enactment shall be 
suspended until the end of the moratorium period. Both the 
moratorium on future significant regulatory actions and the 
suspension of actions already taken apply only to regulatory 
actions that have not been excluded or excepted under other 
provisions of the Act.
    The thirty-day delay for the suspension of recent 
regulatory actions is intended to permit federal agencies and 
the OIRA Administrator, and the President time to identify or 
decide when rulemaking actions qualify for an exception.
    The moratorium is intended to cover those regulatory 
rulemaking actions that are within the constitutional purview 
of this Congress. The Committee is aware that many rulemaking 
actions are appropriate and necessary for carrying out 
regulatory reform, are streamlining efforts already underway, 
are in response to imminent threats to health or safety or 
other form of emergency, or are otherwise appropriate to 
exclude from the moratorium, given the goals and objectives of 
this legislation in the context of larger regulatory reform 
efforts of which it is a part. Thus, this subsection refers to 
section 5 of the Act, which sets forth certain areas in which 
the President has discretion to provide exceptions to the 
moratorium.
    Section 3(b) requires the Administrator of the Office of 
Information and Regulatory Affairs (OIRA) to provide an 
inventory, which shall be published in the Federal Register, of 
the significant regulatory actions that are covered by the 
moratorium and that were taken or made effective from the first 
day of the moratorium period, November 9, 1994, through the 
date of enactment. This requirement is intended to ensure that 
the public, the Congress, and agency officials have notice of 
those significant regulatory actions that are suspended by the 
moratorium.

Section 4. Special rules regarding certain deadlines

    Section 4(a) extends certain statutory deadlines, as well 
as certain deadlines established by courts and regulation. Any 
deadline that is covered by the Act would be extended for 
either five months or until five months after the end of the 
moratorium period, whichever is later. In the case of deadlines 
that would expire during the moratorium period, even with a 
five-month extension, or which have already expired and with 
which agencies or others have not complied, those deadlines 
would be extended until the end of the moratorium period. This 
section covers any deadline for, relating to, or involving any 
action dependent upon a significant regulatory action 
authorized or required by statute or court order and that is 
authorized or required to be taken before the end of the 
moratorium period.
    Section 4(b) defines the term ``deadline'' to mean any date 
certain for fulfilling any obligation or exercising any 
authority established by or under any statute or regulation, or 
by or under any court order implementing any federal statute or 
regulation. A date would be a date certain if it were specified 
in or could be readily calculated on the basis of a statute, 
regulation, or court order. A deadline would be covered if it 
is within the constitutional purview of this Congress. The 
court order directing EPA to issue a Federal Implementation 
Plan for California would be an example of a court order 
deadline extended by this Act.
    The committee is responding to both legal and practical 
concerns in this section. First, this section extends by power 
of law those deadlines that cannot be met because of the 
moratorium. Second, there are situations, such as under the 
Clean Air Act, in which statutory deadlines are prescribed for 
compliance and certain rulemaking actions are necessary 
preconditions for compliance with those deadlines. The failure 
to provide for an extension of those deadlines would, without 
this section, subject agencies, state officials, businesses, 
and the public to a severely compressed period in which to 
comply with the law. This section is intended to relieve that 
time compression. Thus, it is clear that not all deadlines are 
extended, only those deadlines that are directly or indirectly 
related to a significant regulatory action affected by the 
moratorium within these categories.
    Section 4(c) contains a provision under which the 
Administrator of OIRA will identify the list of covered 
deadlines and will publish that list in the Federal Register 
within 30 days after the date of enactment of this Act.

Section 5. Emergency exceptions; exclusions

    Section 5 defines certain areas in which the President is 
given discretion to make exceptions to the moratorium imposed 
by section 3, and the deadline extension under section 4. In 
particular, these areas include matters that pose an imminent 
threat to human health or safety or other emergency, or relate 
to the enforcement of criminal laws. The moratorium on 
rulemaking actions and the postponement of related deadlines 
are waived under the provisions of this section.
    The President could except any specific regulatory 
rulemaking action upon a written request by an agency head. The 
President would need only to find in writing that a waiver for 
the action is appropriate because the regulatory action falls 
within the exemption areas of section 5(a)(2). For example, S. 
219, like its House counterpart, allows the President to make 
an exemption where the regulatory action is: (A) necessary 
because of an imminent threat to health or safety or other 
emergency, or (B) necessary for the enforcement of criminal 
laws. The primary purpose of this exception is to ensure that 
the Act does not impede the promulgation of regulations that 
are necessary to address imminent threats to health or safety. 
This Committee intends the President to exercise reasoned 
discretion in making this certification, guided by this 
Committee's concern for the protection of the health and safety 
of the public.
    It is the Committee's understanding that the President has 
ample authority to except from the moratorium the promulgation 
of rules and regulations that are necessary to make food safe 
from E. coli bacteria, so long as there are no accompanying 
extraneous requirements or arbitrary rules. Several witnesses 
so testified at this committee's hearings.
    The inclusion of the word ``imminent'' is not intended to 
pose an insurmountable obstacle to the certification of health 
or safety regulations. Rather, it is intended to guard against 
the undisciplined use of this exception as a means to evade 
Congressional intent. For example, this Committee does not 
intend this exemption area to apply to OSHA's regulations 
prescribing ergonomic protection standards, which require 
employers to build new work environments to prevent disorders 
associated with repetitive motions. Such regulations could not 
be excepted from the moratorium under section 5(a)(2) because 
they do not address a threat that is imminent.
    It is the intent of the committee to allow the President, 
in his discretion, to exempt from the moratorium regulations 
which will prevent imminent threats to human health and safety. 
The Pathogen Reduction, Hazard Analysis and Critical Control 
Point (HACCP) Systems rulemaking proposed by USDA's Food Safety 
and Inspection Service is an example of a regulation which the 
President may decide, in his best judgment, warrants this 
action. USDA estimates that 5 million cases of food-borne 
illness can be attributed annually to meat and poultry products 
and that these illnesses result in 4,000 deaths each year. 
Implementation of the HACCP proposal is expected to reduce the 
number of these illnesses by 90 percent.
    The Bureau of Alcohol, Tobacco, and Firearms has proposed 
to issue final regulations governing the alteration of producer 
recall information on containers of distilled spirits, wine and 
beer under the Federal Alcohol Administration Act of 1935 (27 
U.S.C. 105e) that would facilitate the ability of the producer 
to recall his product to protect the health or safety of the 
consuming public. If so, these regulations could be excluded 
from the moratorium under this provision.
    The bill as reported when compared to the bill as 
introduced allows further exemptions in section 5(a)(2) where 
the significant regulatory action is: (C) related to a 
regulation that has as its principal effect fostering economic 
growth, repealing, narrowing, streamlining, or otherwise 
reducing regulatory burdens; (D) related to military, foreign 
affairs, or international trade; (E) principally related to 
agency organization, management, or personnel; (F) a routine 
administrative action, or principally related to public 
property, loans, grants, benefits, or contracts; (G) related to 
negotiated rulemaking between Indian tribes and the applicable 
agency under the Indian Self-Determination Act Amendments of 
1994; or (H) limited to interpreting, implementing, or 
administering the internal revenue laws of the United States.
    In creating the exemption area for streamlining under 
section 5(a)(2)(C), the Committee notes that there are a number 
of ways a rule can be determined to be streamlining. Some 
rules, such as a pending decision to lower bank deposit 
insurance premium rates by the Federal Deposit Insurance 
Corporation, can be less burdensome on their face. Other rules 
can be excluded from the moratorium if they reduce regulatory 
burdens by providing more cost-effective methods for achieving 
the requirements of a law. Rules that implement market-based 
solutions or that provide alternate systems for compliance 
would also be among those that should qualify for this 
exclusion. Such an example would be regulatory changes 
currently being considered by the Environmental Protection 
Agency to its final reformulated gasoline rules. In addition, 
regulations promulgated under the authority of statutes that 
serve to streamline an agency function should also fall within 
this exclusion. An example of a rule which meets these latter 
criteria is the rule establishing procedures for the Opt-In 
program for Combustion Sources under section 410 of the Clean 
Air Act. The opt-in program allows the sale of excess sulfur 
dioxide emission allowances resulting from voluntary emission 
reductions to sources which have sulfur dioxide compliance 
obligations under Title IV of the Clean Air Act. Another 
example of a rulemaking covered by this exclusion would be 
those regulations promulgated pursuant to the Federal 
Acquisition Streamlining Act of 1994 (P.L. 103-355).
    The Committee notes that regulatory changes being sought by 
EPA and states with respect to the Inspection and Maintenance 
and Transportation Conformity rules under the Clean Air Act are 
activities that reduce regulatory burdens and therefore would 
qualify for an exemption under 5(a)(2)(C).
    Section 5(a)(2)(C)'s exclusion for streamlining regulations 
should be broadly interpreted to include those agency actions 
required to determine whether a regulation is, in fact, 
streamlining in nature. For example, the Department of 
Transportation is currently considering whether alternative 
standards to the existing HM-181 standards are appropriate for 
open-head fibre drums used for the transportation of liquids. 
If the Department of Transportation determines that such 
alternative standards are appropriate, that decision could 
result in eliminating an unnecessary regulatory burden on the 
fibre-drum industry. Obviously, the Department should be 
permitted to not only promulgate such regulations (if 
appropriate), but also to take preliminary actions necessary to 
determine whether the alternative standards are appropriate. 
Similarly, the Bureau of Alcohol, Tobacco and Firearms is about 
to issue final regulations governing trade practices under the 
Federal Alcohol Administration Act of 1935 (27 U.S.C. 201 et 
seq.) that could simplify alcohol promotional practices. If so, 
these regulations could be excluded from the moratorium under 
this provision. The Committee is also aware that the EPA is 
scheduled to promulgate a final rule in August 1995 clarifying 
the liability of secured creditors under the EPA's underground 
storage tank regulations. Such a rule is likely to reduce 
regulatory burdens in this area and could be excluded from the 
moratorium on this basis.
    In order to avoid any ambiguity, the Committee explicitly 
notes that actions taken under Section 301 of the Trade Act of 
1930 (19 U.S.C. 2411 et seq.) would be exempt from the 
moratorium. Section 301 authorizes the USTR to enforce United 
States rights under trade agreements, and therefore is an 
enforcement function and not a regulatory action. This, 
therefore, is not a matter committed to Presidential discretion 
under subsection 5(a)(2)(D).
    There are many other examples of rules that streamline or 
reduce the regulatory burden. The Environmental Protection 
Agency has been working for some time to streamline existing 
regulations on the phaseout of the production of ozone-
depleting chemicals and to reduce burdens imposed by those 
regulations. The new rule accomplish several goals. The new 
regulations will be consistent with the Montreal Protocol on 
Substances that deplete the Ozone Layer by permitting U.S. 
producers of ozone-depleting chemicals to continue to produce 
and sell those chemicals in foreign markets for feedstock use. 
This would narrow and streamline the existing rule by providing 
treatment for production for export feedstock use consistent 
with the existing rules for domestic feedstock use. The 
regulations also would modify rules on the import of ``used'' 
or ``recycled ozone-depleting chemicals to reduce illegal 
imports. The Committee believes that the exemption for rules 
that streamline rules or otherwise reduce regulatory burdens 
would apply to these EPA regulations on the phaseout of ozone-
depleting chemicals.
    The Committee intends the term ``international trade'' in 
subsection 5(a)(2)(D) to be read broadly to exempt from the 
moratorium regulatory actions, that interpret, implement or 
administer the nation's import, export, and tariff laws, such 
as the Customs Modernization Act, that was part of the 
implementing legislation for the North American Free Trade 
Agreement. Pub. Law 103-182, 107 State. 2057 (Dec. 8, 1993). 
The Committee intends the exclusion for regulations relating to 
international trade agreements to provide the Executive branch 
with the flexibility to promulgate appropriate regulations to 
carry out international trade agreements, such as the NAFTA and 
the Uruguay Round of the GATT, including all agency actions 
required by the Uruguay Round Agreements Act.
    Section 5(a)(2)(F)'s exclusion for routine administrative 
functions is intended by the Committee to be an exception for 
regulations that are purely routine or administrative in 
nature. This category of exclusion was initially created out of 
bipartisan concern that such obvious regulatory necessities as 
the authorization of daylight savings time (which is contained 
in 49 C.F.R. Part 71.2) should not be included in the 
moratorium.
    It is also the intent of the Committee that the exception 
for routine administrative functions provided by section 
5(a)(2)(F) would provide an exemption for agencies, such as the 
Nuclear Regulatory Commission, or the Securities and Exchange 
Commission for any regulations concerning the collection of 
user and/or filing fees.
    The Committee also notes that the exception provided by 
section 5(a)(2)(F) for significant regulatory action 
principally related to ``benefits'' would exempt from the 
moratorium regulations concerning the distribution of benefits, 
including veterans benefits. The committee adopted an amendment 
to specify that the moratorium would not apply to any 
regulation to compensate Persian Gulf War veterans for 
disability from undiagnosed illnesses. However, this amendment 
does not mean that the ``benefits'' exception does not cover 
benefits for gulf War veterans, other veterans or other benefit 
recipients.
    It is the opinion of the Committee that the regulations 
published on January 6, 1995 implementing the Federal Crop 
regulations necessary for the implementation of that Act fall 
completely within the exception provided within this 
legislation under section 5(a)(2)(F) and, therefore, are exempt 
from any moratorium established by this legislation. That Act 
provides benefits to farmers through insurance policies or 
contracts and thus this bill should not be used to withhold 
such benefits or interfere with such contracts as provided for 
under the exception in section 5(a)(2)(F).
    It is the expectation of the Committee that the Treasury 
Department will not invoke the exception granted actions 
relating to internal revenue laws so as to issue regulations 
inconsistent with the historical views of the Congress 
regarding the export source rules of section 863(b) or to 
reverse a court decision interpreting that section.
    Section 5(a)(3) requires that findings to exclude 
significant regulatory actions from the moratorium under 
section 5 must be published in the Federal Register by the 
agency head.

Section 6. Definitions

    Section 6 contains the definitions of certain terms used in 
the Act.
    Section 6(1) defines ``Federal agency'' in the same manner 
as that term is defined in the Administrative Procedures Act, 5 
U.S.C. 551(1).
    Section 6(2) defines ``moratorium period'' as the period of 
time beginning November 9, 1994, and ending on December 31, 
1995, (unless an Act of Congress such as regulatory reform 
legislation provides an earlier termination date).
    Section 6(3) defines ``significant regulatory action'' by 
stating the general rule in subsection (A)(i) and further 
limiting the term in subsection (A)(ii). Subsection 6(3)(A)(i) 
defines ``significant regulatory action'' to include the 
issuance of any substantive rule, interpretive rule, statement 
of agency policy, guidance, guidelines, or notice of proposed 
rulemaking. Section 6(3)(A)(ii) further limits the term 
``significant regulatory action'' to any action that the 
Administrator of the Office of Information and Regulatory 
Affairs finds--(i) has an annual effect on the economy of 
$100,000,000 or more or adversely affects in a material way the 
economy, a sector or the economy, productivity, competition, 
jobs, the environment, public health or safety, or State, 
local, or tribal governments or communities; (ii) creates a 
serious inconsistency or otherwise interferes with an action 
taken or planned by another agency; (iii) materially alters the 
budgetary impact of entitlements, grants, user fees, or loan 
programs or the rights and obligations of recipients thereof; 
or (iv) raises novel legal or policy issues arising out of 
legal mandates, the President's priorities, or the principles 
set forth in Executive Order 12866.
    Subsection 6(3)(B) then expands ``significant regulatory 
action'' to cover certain restrictions on the use of public 
lands and certain wetlands determinations. The authority to 
grant exceptions provided by section 5(a)(2) does not apply to 
the wetlands determinations covered by section 6(3)(B)(ii). 
Finally, section 6(4) provides added exclusions to the term 
``significant regulatory action'' through the definition of 
``rule; guidance; or guidelines''.
    The definition of ``significant regulatory action'' does 
not include cost/benefit analysis and risk assessment actions, 
as well as activity necessary for conducting a cost/benefit 
analysis or risk assessment on regulations already proposed (or 
already promulgated). Obviously, such an analysis or assessment 
would not be conducted where a regulation has not yet been 
issued or proposed, nor could the allowance of such activity be 
considered as a means to permit new proposed rulemaking to be 
issued.
    Section 6(4) defines ``rule,'' ``guidance,'' or 
``guideline'' as the whole or part of an agency statement of 
general or particular applicability and future effect designed 
to implement, interpret, or prescribe law or policy. Having 
affirmatively stated the meaning of ``rule,'' ``guidance,'' or 
``guidelines,'' this subsection clarifies the meaning by 
listing a variety of agency actions that do not constitute a 
``rule,'' ``guidance,'' or ``guidelines.'' Because such actions 
are outside of the definition of ``rule,'' ``guidance,'' or 
``guidelines'', they are likewise outside the scope of the 
moratorium and do not need to be certified as an exclusion or 
exception in order for the action to occur.
    One of the general principles underlying this list of non-
rules, non-guidance, and non-guidelines is a concern that the 
free market be allowed to operate without additional 
interference from government. Thus, agency actions that must be 
taken in order for new technology, products, or services to be 
made available to the public are not intended to be stopped by 
the moratorium. For example, the Act does not prohibit the 
Federal Communications Commission from issuing rules to 
establish and govern the introduction of a new communications 
service, including those that involve changes in the use of the 
radio spectrum. Nor does the Act prohibit the Food and Drug 
Administration from issuing pre-market approvals for 
pharmaceuticals, medical devices, and food additives.
    The Committee also intends the list of non-rules, non-
guidance, and non-guidelines to include the expansion, 
contraction, or limitation of authority to harvest Federal 
fishery resources as recommended by a Regional Fishery 
Management Council or the Atlantic States Marine Fishery 
Commission. Moreover, amendments to existing regulations 
promulgated by the USDA Agricultural Marketing Service relating 
to self-help or industry marketing initiatives designed to 
improve the agricultural marketing sectors ability to 
distribute agricultural commodities were not intended to be 
included in the meaning of the term ``rule.''
    The Committee intends that the term ``rule'' does not 
include rules of securities self-regulatory organizations 
registered with the Securities and Exchange Commission. Section 
19(b) of the Securities and Exchange Act of 1934 requires self-
regulatory organizations such as national securities exchanges 
to submit their own rules to the SEC for publication in the 
Federal Register, opportunity for public comment, and SEC 
approval or disapproval. Self-regulatory organizations need 
rule-making flexibility to ensure the orderly operation of the 
securities markets. Their rules are not federal rules for the 
purpose of this legislation, but private sector rules which 
require SEC approval under the securities laws.
    The Committee understands that there could well be 
overlapping bases for exclusions from the moratorium. In 
particular, section 6(4)(L) removes from the definition of 
``rule,'' ``guidance,'' or ``guidelines'' agency actions that 
tend to ease regulatory burdens. Such regulations could also be 
excluded from the moratorium by section 5(a)(2)(C)'s exclusion 
for streamlining regulations. The Fish and Wildlife Service's 
proposed 4(d) rule for the Northern Spotted Owl is an example 
of the type of rulemaking that should move forward under S. 
219. According to the Administration, the proposed rule will 
provide ``relief from certain of the current restrictions and 
would increase timber available for harvest on non-federal 
lands, provide certainty to landowners--in particular small to 
mid-sized landowners--and minimize social and economic costs 
resulting from the conservation of the owl.'' This proposed 
rule clearly meets the definition of excluded regulatory 
rulemaking action. The Committee encourages the Fish and 
Wildlife Service to develop other 4(d) rules with similar 
economic and social effects. Such special rules to reduce the 
impact of the Endangered Species Act on private property are 
actions to relieve regulatory restrictions under section 
6(4)(D).
    The Committee intends to exclude from the definition of 
``rule'' the final rule issued by the United States Department 
of Agriculture (and published in the Federal Register on Dec. 
6, 1994) on meat derived from advanced separation machinery. 
This rule effectively relieves a regulatory restriction on the 
meat industry by updating the definition of meat, and 
permitting the meat industry to treat as meat rather than as 
``mechanically separated (species)'' those ingredients derived 
from machines that separate meat from bone without grinding, 
crushing, or pulverizing the bone. Under prior regulation, meat 
that was mechanically de-boned could not be marketed as meat, 
but only as ``mechanically separated (species).'' This rule 
recognizes the advance in meat/bone separation technology over 
prior systems, allows the public to benefit from this new 
technology, and permits industry to distribute its product 
properly identified as meat rather than as ``mechanically 
separated (species).''
    Section 6(4)(B) contains an exception to the moratorium to 
provide for actions taken in connection with the implementation 
of monetary policy or actions taken to ensure the safety and 
soundness of federally insured depository institutions, credit 
unions, or government sponsored housing enterprises or to 
protect the deposit insurance funds. Safety and soundness 
regulations are designed to supervise conduct contrary to 
accepted standards of banking operations which might result in 
abnormal risk or loss to banking institutions or shareholders. 
The moratorium will in no way affect such safety or soundness 
regulations. Moreover, as explained above, the moratorium does 
not prevent the Federal Deposit Insurance Corporation from 
proposing and subsequently adopting a revised rule to reduce 
the deposit insurance premiums paid by banks. In providing this 
exception, the Committee also wants to make clear that any 
regulations relating to the Community Reinvestment Act, the 
Truth in Lending Act or any other consumer law are not to be 
considered matters of safety or soundness and are not covered 
by this limited exclusion in any manner.
    The Committee intends to exclude from the definition of 
``rule'' such regulations as issued on February 15, 1995, by 
the Department of Housing and Urban Development to revise and 
clarify the final rule on escrow accounting procedures under 
the Real Estate Settlement Procedures Act. The February 15 
regulations reduce regulatory burden by eliminating a 
requirement to provide a detailed explanation, when providing 
borrowers with their annual escrow account statement, of why 
the low point in the escrow account may have exceeded the 
amount permitted by the regulation.
    The Senate bill preserves the independence of the Federal 
Reserve Board (and other financial regulators) in section 
6(4)(B), by exempting from the definition of ``rule'' (and 
thereby exempting from the moratorium) prescriptions of rates 
and `'any action taken in connection with the implementation of 
monetary policy or to ensure the safety and soundness of 
federally insured depository institutions.
    It is the intent and understanding of the Committee that 
section 6(4) exempts any restrictions on actions to implement 
self-help marketing initiatives, marketing order mergers, or 
generic promotion programs. Therefore, such programs would not 
be subject to the moratorium on regulations provided by the 
bill.
    For purposes of section 6(4)(B), the term ``government 
sponsored housing enterprise'' has the same meaning as the word 
``enterprise'' as that word is defined in section 1303(6) of 
the Housing and Community Development Act of 1992. It is the 
Committee's understanding and intent that the following 
agencies would be covered by section 6(4)(B): the Federal 
Reserve Board, the Federal Deposit Insurance Corporation, the 
Office of the Comptroller of the Currency, the Office of Thrift 
Supervision, the National Credit Union Administration, and the 
Office of Federal Housing Enterprise Oversight.
    Section 6(5) defines ``license'' as an agency permit, 
certificate, approval, registration, charter, membership, 
statutory exemption, or other form of permission.
    Section 6(6) defines ``public property'' as all property 
under the control of a Federal agency, other than land.

Section 7. Exclusions

    This section makes clear that the Act does not apply to any 
significant regulatory action to prohibit discrimination on the 
basis of race, religion, sex, age, national origin, handicap, 
or disability status.

Section 8. Civil Actions

    This section makes it clear that the Act prohibits 
adjudicative review of any determination under the Act by any 
administrative tribunal or court of law.

Section 9. Severability

    Section 9(a) states that the Act supersedes other law, and 
is effective notwithstanding any other provision of law.
    Section 8(b) makes each provision of the Act severable from 
each other provision. If a court holds any provision of the Act 
to be invalid, or holds invalid the application of any 
particular provision of the Act in any particular or general 
circumstance, only the specific provision at issue shall be 
affected. The remainder of the Act, and its application in all 
other circumstances, shall remain in full force and effect.

                  V. REGULATORY IMPACT OF LEGISLATION

    Paragraph II(b) of rule XXVI of the Standing Rules of the 
Senate requires that each report accompanying a bill evaluate 
``the regulatory impact which would be incurred in carrying out 
the bill.'' Because enactment of S. 219 would not result in any 
additional regulation of individuals and would simplify present 
law, the Committee anticipates a beneficial result from the 
moratorium on regulations and from the subsequent regulatory 
reform legislation the moratorium is intended to serve.

                    VI. COST ESTIMATE OF LEGISLATION

                                     U.S. Congress,
                               Congressional Budget Office,
                                    Washington, DC, March 15, 1995.
Hon. William V. Roth, Jr.,
Chairman, Committee on Governmental Affairs,
U.S. Senate, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
reviewed S. 219, the Regulatory Transition Act of 1995, as 
ordered reported by the Senate Committee on Governmental 
Affairs on March 9, 1995. We estimate that enacting the bill 
would result in changes in discretionary administrative and 
other costs to the federal government, but that the net changes 
would be less than $500,000 annually. In addition, enacting S. 
219 could affect direct spending; however, the consequences of 
the bill are not sufficiently clear for CBO to be able to 
determine whether there would be such effects or how much they 
would be. Because the bill could affect direct spending, pay-
as-you-go procedures would apply.

Bill purpose

    S. 219 would prevent federal agencies from taking most 
significant regulatory rulemaking actions from the date of 
enactment of the bill until December 31, 1995. (The bill 
defines a significant regulatory action generally as one having 
an economic impact of at least $100 million annually.) In 
addition, beginning 30 days after enactment, most significant 
rules issued during the period from November 9, 1994, to the 
date of enactment would be suspended until December 31, 1995. 
Deadlines relating to such suspended rules would be extended 
for five months or until December 31, 1995, whichever is later. 
These provisions could be waived if the Office of Information 
and Regulatory Affairs within the Office of Management and 
Budget finds that the regulatory action involves an imminent 
emergency or the enforcement of criminal laws. Many other 
regulatory rules also would be exempt from S. 219, including 
those relating to the internal revenue laws of the United 
States.

Impact on discretionary spending

    Agencies would incur some additional costs to determine 
which of their existing significant rules should be suspended 
and to resolve issues that result from extending the deadlines. 
Agencies also would have to determine which proposed new 
significant rules would meet the exemptions of the bill and 
could therefore be implemented. These tasks, and others 
relating to S. 219, are not done under current law; however, 
agencies could save some resources that would otherwise be used 
to write new regulations. CBO estimates that any net 
administrative costs or savings from enacting the bill would be 
less than $500,000 annually.

Impact on direct spending

    The impact of the rulemaking moratorium on direct spending 
and receipts is uncertain both in magnitude and direction. 
Whether or not a direct spending program is affected would 
depend on how an agency interprets the bill's exemptions (in 
section 5) and the bill's definition of a significant 
regulatory action (in section 6).
    The rulemaking moratorium could affect the issuance of 
regulations governing the payment rates for some federal 
benefit programs, like Medicare or Medicaid. But the exclusion 
in section 5(a)(2)(F) could be interpreted to mean that 
regulations specifying changes in such benefit programs would 
not be affected by the moratorium. Moreover, because S. 219 
does not change the laws underlying entitlement benefits, the 
rights of individuals to benefits specified in law should not 
be affected. However, implementation of the law often depends 
on Federal Register notices and regulations that indicate how 
the law is to be implemented. A delay in publishing regulations 
might well lead to litigation because of differing 
interpretations of the law.
    CBO also considered whether or not enactment of this 
legislation could interfere with the ability of agencies, such 
as the Nuclear Regulatory Commission (NRC), to assess user fees 
and charges. Under current law, NRC and other agencies will 
issue rules this year to collect more than $500 million in user 
fees, with the NRC accounting for about $400 million of these 
fees in 1995. S. 219 could prevent the collection of such fees 
if agencies are prevented from issuing the necessary 
regulations. Based on information from the administration, 
however, we expect that most agencies would take the actions 
necessary to collect user fees, claiming that their collection 
efforts are exempted from the moratorium imposed by S. 219. 
Some agencies could claim that their actions in collecting fees 
do not meet the definition of a significant regulatory action 
in section 6 of the bill, while others may rely on one of the 
exemptions included in section 5. Because such agency 
determinations are not subject to judicial review, CBO does not 
expect enactment of this bill to interfere with collection of 
these user fees.
    Specific reference in section 6 to regulations affecting 
management of federal lands and programs regulating wetland 
conservation areas could increase direct spending. In the case 
of federal land management, enacting the bill could hinder 
implementation of the President's Forest Plan for the 
northwest. Failure to implement this plan could result in a 
court injunction, limiting or shutting down timber harvests in 
certain regions where previous endangered species 
determinations would apply. Based on information provided by 
the Department of Agriculture, we believe that issuance of an 
injunction could lower timber receipts in the Pacific 
Northwest.
    A limitation on agency actions applying to wetland 
conservation could encourage farmers to utilize acreage 
otherwise subject to use restrictions. If this leads to 
increased planting of crops supported by Department of 
Agriculture commodity programs, then federal outlays would 
increase. Again, however, the bill provides latitude for 
exempting specific actions, and because such determinations are 
not subject to judicial review, there is no indication that the 
administration would significantly alter these programs of the 
Department of Agriculture.

Impact on State and local governments

    Enacting S. 219 would not affect any routine, ongoing 
payments to state and local governments, but the bill could 
affect federal payments that are subject to rulemaking during 
the period covered by the bill. It is possible that some 
regulatory actions that would otherwise provide relief to state 
and local governments could be delayed or precluded, thereby 
increasing their costs for various activities. CBO has no basis 
for predicting the direction, magnitude, or timing of such 
impacts.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contacts are Mark 
Grabowicz, who can be reached at 226-2860, and Paul Cullinan.
            Sincerely,
                                         June E. O'Neill, Director.
                          VII. MINORITY VIEWS

              1. overview: regulatory reform, not a freeze

    The regulatory moratorium established by S. 219 would 
suspend all significant proposed and final regulations, policy 
statements, guidance and guidelines issued or to be issued from 
November 9, 1994, through December 31, 1995--and all statutory 
and judicial deadlines for such actions from November 9, 1994, 
through May 1996. While comprehensive regulatory reform is 
clearly needed for the Federal government, this legislation is 
not an appropriate or necessary way to achieving such reform as 
its proponents claim.
    S. 219 as reported by our Committee is dangerous; it does 
not distinguish between good and bad regulations. It suspends 
regulations designed to protect public health and safety but 
exempts regulations solely because they may ease administrative 
requirements. It is arbitrary and reckless. Based seemingly on 
whim, it exempts some regulations but not others even though 
the regulations may be comparable.
    There are indeed overly burdensome rules and regulations. 
As the majority points out, the cumulative costs of Federal 
regulations have risen over the past twenty years. (The 
majority states, however, that the cost of regulations is 
``conservatively estimated'' at $560 billion for 1992. That 
estimate is highly questionable and is certainly not 
``conservative''. A GAO review of that estimate submitted to 
the Committee on March 8, 1995, suggests serious problems in 
the methods used in that particular study.) Congress must be 
sensitive to this fact. We must ensure that the laws we pass 
meet public needs effectively and efficiently. The mounting 
costs of regulations require that we closely examine both the 
regulatory process and the laws that result in regulations. 
But, we must not ignore the significant improvements that 
regulations can bring to the daily lives of Americans. For 
example, since the Occupational Safety and Health 
Administration came into being in 1970, the workplace fatality 
rate has dropped by over 50 percent. The Food and Drug 
Administration has made our food and medicines safer. Thanks to 
the work of the Environmental Protection Agency, our country 
now enjoys cleaner air and water.
    Clearly the work of government is not finished. The 
government still has a vital role to play in protecting public 
health and safety, ensuring equal opportunities in education, 
employment and housing, promoting a healthy economy, and 
protecting the environment. With diminishing resources, the 
question becomes how we can provide these services in a cost-
effective way. The Congress and the Executive Branch must work 
together to continue to improve the way the government does 
business, and in fact several initiatives are already 
underway--from government streamlining and reengineering to 
regulatory reform.
    Much more is at stake, however, than merely improving 
government processes. The regulatory moratorium legislation 
implies that Federal agencies have simply run amok by issuing 
too many regulations and that process controls will fix 
everything. This is just not true. As stated in one of the 
hearings before the Committee, perhaps 80 percent of all agency 
rules are required by law. Agencies regulate because the law 
requires them to do so. Thus, while the majority report 
accurately describes the increase in regulations over the last 
twenty years, it ignores the twenty years of legislation (most 
signed by Republican Presidents) that led to this increase in 
rules. While nameless ``regulations'' may be a convenient 
whipping boy, it ignores the reality of the harder task of 
tackling individual substantive law. This is a major reason 
that, while the majority report suggests that there is 
universal support for a moratorium, the proposal is, to the 
contrary, actually quite controversial. More than 200 groups 
have opposed the moratorium, including the American Heart and 
Lung Associations, the Child Welfare League of America, the 
Consumer Federation of America, the Epilepsy Foundation of 
America, the Leadership Council on Civil Rights, the League of 
Women Voters in the U.S., and the National Council of Senior 
Citizens.
    Finally, whatever the interests of its proponents, the 
moratorium legislation is truly unnecessary. The President has 
required all Federal agencies to review their regulations and 
to report back by June 1 on those which should be eliminated or 
changed. This report will provide the information we need to 
reform regulations and programs smartly, avoiding arbitrary and 
potentially grave, unintended consequences. In addition, there 
are various regulatory reform initiatives underway in this and 
other committees to strengthen our regulatory system--risk 
assessment, cost-benefit analysis, review of existing rules, 
centralized regulatory review, and more. A moratorium does 
nothing toward real regulatory reform.

                         2. the flaws of s. 219

    While proponents of the moratorium state that its purpose 
is to improve efficiency and effectiveness and allow for 
``Congress to rationalize the regulatory reform process,'' the 
moratorium is ironically an inefficient, ineffective, and 
irrational approach. The moratorium will create delays in good 
regulations, waste money, and create great uncertainty for 
citizens, businesses, and others. The report speaks of the 
regulatory process being ``ossified, unresponsive, and 
inefficient.'' The moratorium will only add to that. For 
example:
    While the moratorium purports to be a neutral ``time-out'' 
for all significant regulatory actions, the targeted rules and 
the variety and number of exceptions are evidence that the 
legislation is really an example in political ``ticket 
fixing.''
    During the Committee mark-up numerous exceptions to the 
moratorium were accepted. Members offered twenty-two amendments 
to S. 219. Many were to exempt specific health and safety rules 
from the moratorium; others were to exempt broad categories of 
regulations; two were put forth that would expand the scope of 
the moratorium. Thirteen amendments were accepted, eight 
rejected, and one tabled. There appeared to be very little 
logic in what was rejected or accepted. Although meat and water 
safety amendments were defeated, others, such as exemptions 
related to commuter air safety, railroad crossing safety, duck 
hunting, and lead poisoning prevention, were passed. We fully 
supported all amendments that would limit the moratorium. The 
inconsistency, however, of the majority only heightens our 
concerns about the legislation.
    The bill's exemption of rules that address any ``imminent 
threat to health and safety'' is unclear and the majority 
report's interpretation leaves unanswered many questions about 
what would and would not be covered. The bill would permit the 
President, upon written request by an agency head, to exempt a 
significant regulatory action from the moratorium upon a 
finding that the regulatory action ``is necessary because of an 
imminent threat to human health or safety or other emergency'' 
(sec. 5(a)(2)(A)). For certain amendments in the mark-up, the 
majority argued that specific exemptions were unnecessary 
because of the broad exemption authority given to the President 
under section 5 of the legislation. The majority could not, 
however, provide a consistent interpretation of ``imminent'' or 
how it would be applied.
    For example, an amendment to exempt regulatory actions to 
reduce pathogens in meat and poultry was rejected. This 
amendment would address rules to update inspection techniques 
for meat and poultry and would provide a safeguard against E. 
Coli and other contamination. Mr. Rainer Mueller, whose son 
died from El Coli-contaminated hamburger, testified before the 
Committee on February 22, and poignantly described the personal 
tragedy and ultimate price paid for unsafe food. In January, 
the U.S. Department of Agriculture released a proposed 
Hazardous Analysis Critical Control Point regulation to improve 
meat and poultry inspection. This rule would mandate rigorous 
sanitation requirements and scientific testing for bacteria in 
meat and poultry processing. While the minority argued that E. 
Coli was indeed a serious health threat, it would probably not 
be considered ``imminent,'' and therefore it should be 
specifically included as an exemption in the bill. Chairman 
Roth stated, ``S. 219 depends on the use of common-sense 
judgment by the President. `Imminent' is not intended to pose 
an insurmountable obstacle * * *. We are actually empowering 
the President to take appropriate action in such situations * * 
*.''
    Senator Glenn also proposed an amendment to exempt actions 
by EPA to control microbial and disinfection byproduct risks, 
such as cryptosporidium, in drinking water supplies. 
Cryptosporidium killed over 100 people in Milwaukee, Wisconsin, 
and made 400,000 sick. Again, this amendment was rejected, with 
the bill's proponents citing the Presidential discretion to 
exempt rules that deal with imminent health and safety 
problems.
    At the very end of the markup, however, the Committee 
reversed this thinking by accepting an amendment to exempt 
rules relating to lead poisoning prevention. Senator Roth 
stated, ``I do think it falls within the exemptions [of 
``imminent threat''], but we are willing to accept the 
amendment.'' This broad amendment would exclude from the 
moratorium any action by the EPA that would protect the public 
from exposure to lead from house paint, soil or drinking water. 
Included in the regulations that would be affected by the 
moratorium would be requirements that home buyers and renters 
by informed if there are known lead hazards prior to making 
purchases or rental decisions, and that all lead abatement 
workers are certified to professional standards of practice.
    The majority report attempts to resolve the uncertainties 
left from the mark-up by stating that USDA's meat inspection 
rules should be exempted ``so long as there are no accompanying 
extraneous requirements or arbitrary rules''. We are at a loss 
to understand the meaning of that condition. The report also 
states that ``this Committee does not intend this exemption 
area to apply to OSHA's regulations prescribing ergonomic 
protection standards,'' but that the Bureau of Alcohol, 
Tobacco, and Firearms rule on alcoholic beverage container 
recall information ``could be excluded from the moratorium 
under this provision.'' The minority is simply at a loss to 
understand the majority's logic, or the legislative record on 
which to base such findings.
    The Committee's treatment of these regulations and the 
``imminent threat'' exemption leaves a completely inconsistent 
record. And despite the majority's suggestion, ``imminent'' 
will not cover most important health and safety rules. The 
statutory language refers to ``imminent threat to human health 
or safety or other emergency'' (emphasis added). Moreover, the 
definition of ``imminent'' is ``likely to occur at any moment, 
impending; threateningly or menacingly near or at hand.'' Most 
health and safety rules, while designed to addressed pressing 
problems, simply can not be described as emergency rules in any 
common understanding of the term.
    What deserves to be exempted ``just in case'' and what does 
not? There was much discussion on the intent of the moratorium, 
and what some of the unintended consequences might be. Clearly 
the Committee decided that rules related to public health 
(e.g., meat and poultry inspections, drinking water safety) did 
not need to be specifically exempted ``just in case'' they were 
not exempted under other provisions in the bill. Others, 
including some that had potential to be exempted through other 
language in the bill were nonetheless included as specific 
amendments. For example, the Committee accepted an amendment to 
exempt any regulatory action to provide compensation to Persian 
Gulf War Veterans for disability from undiagnosed illnesses. 
While some on the majority argued that the rule to allow the 
Secretary of Veterans Affairs to provide such compensation 
would be already included under exemptions for ``benefits'' or 
for ``military affairs,'' the Committee decided to vote in 
favor of this amendment ``just in case.''
    The Committee also accepted an amendment that would exempt 
agency action that ``establishes, modifies, opens, closes, or 
conducts a regulatory program for a commercial, recreational, 
or subsistence activity relating to hunting, fishing, or 
camping.'' This amendment would ensure that duck-hunting season 
would not be affected by the moratorium. Senator Cochran 
stated, ``The point of the moratorium was never to interfere 
with this kind of regulation. * * * [T]he word gets all over 
the country that this legislation is going to have this 
unintended consequence. So the point of the amendment is to 
make certain that nobody can misunderstand this.''
    In addition, the Committee decided to accept an amendment 
that would exempt from the moratorium any clarification by the 
Department of Transportation of existing responsibilities 
regarding highway safety warning devices. The intent of this 
amendment is to clarify state and local authority for 
determining whether a railroad crossing device is necessary and 
the installation of such a device. The Committee also accepted 
amendments related to aircraft safety, commuter plane safety, 
and aircraft flights over national parks.
    As stated earlier, other health and safety amendments were 
rejected, even though it is not at all clear that they will 
fall under the exemption for ``imminent'' health and safety 
threats. For example, an amendment to exempt rules relating to 
safe disposal of nuclear waste and to decontamination and 
decommissioning standards for NRC-licensed facilities was not 
accepted. The Chairman argued that this would qualify as an 
``imminent threat'' and would therefore not be needed. However, 
it is difficult to argue that some waste, which has been 
sitting in temporary storage for decades, now presents an 
``imminent'' hazard, or that standards for decontaminating or 
decommissioning NRC-licensed sites, which have been under 
development for some time, now fall under an ``imminent'' 
exemption.
    The Committee accepted an amendment to exempt any actions 
to establish or enforce rights that prohibit discrimination on 
the basis of race, religion, sex, age, national origin, or 
handicapped or disability status. Directly after accepting this 
amendment, the Committee voted to table an amendment that would 
have exempted any actions to enforce the constitutional rights 
of individuals, on the grounds that there was ``a certain 
amount of ambiguity.'' These amendments are similar to ones 
included by the Committee in the unfunded mandates legislation. 
As Senator Levin stated, ``this is a lot less ambiguous than 
[other amendments adopted by the Committee]. These are 
constitutional rights, and constitutional rights have been 
clearly defined. * * * If we are going to protect statutory 
rights to non-discrimination, * * * surely we ought to give the 
same protection to constitutional rights that are being 
implemented or enforced by law. * * * We should not put 
constitutional rights on a lower level than the statutory 
rights.''
    The Committee accepted an amendment to exempt any rules 
under the Indian Self-Determination act which had been the 
product of regulatory negotiation. Yet, when Senator Levin 
proposed an amendment to exclude all consensual rulemakings, 
the amendment was rejected.
    In addition to the indiscriminate acceptance and rejection 
of amendments in Committee on specific rules, the majority 
report lists rules that are meant to be covered by the 
moratorium. In not one instance did the Committee in any of its 
deliberations make any finding on the merits of any of these 
rules. There may well be good arguments for stopping some or 
all of these rules, but that is not the point. The majority is 
creating exemptions from specific agency decisions with no 
legislative record.
    The juxtaposition in the majority report of these so-called 
``bad rules'' with what appear to be special interest ``good 
rules'' shows how inequitable and unfair this process is. There 
is no legislative record in the Committee to support the 
findings, let alone discussion, of the ``good'' regulations 
referred to in the Committee report. Consider the following 
striking examples of rules that the majority report stated 
should not be included in the moratorium and for which the 
Committee has absolutely no record:
          ``Final regulations governing the alteration of 
        producer recall information on containers of distilled 
        spirits, wine and beer under the Federal Alcohol 
        Administration Act of 1935 (27 U.S.C. 105e)'';
          ``Final regulations governing trade practices under 
        the Federal Alcohol Administration Act of 1935 (27 
        U.S.C. 201 et seq.)'' relating to ``alcohol promotional 
        practices'';
          ``The final rules issued by the United States 
        Department of Agriculture (and published in the Federal 
        Register on Dec. 6, 1994) on meat derived from advanced 
        separation machinery''; and
          ``Department of Transportation ``HM-181 standards . . 
        . for open-head fiber drums used for the transportation 
        of liquids.''
    The retroactivity of the moratorium stops regulations that 
have already been issued and creates unnecessary confusion. The 
bill applies both prospectively and retroactively. It would 
apply to all significant regulatory actions that occurred as of 
November 9, 1994. Retroactively stopping rules is extremely 
unfair to businesses and individuals who have complied with the 
regulatory process, playing by the rules, and counting on the 
finality of the regulations already in effect. Many businesses 
have already spent money to comply with regulations, or made 
investments based upon regulations that have been issued. 
Retroactively suspending final rules could give a competitive 
advantage to businesses that chose to ignore regulations issued 
since November. Similarly, it is unfair to companies that made 
investments to comply with those regulations. Regulatory reform 
should be prospective not retroactive; to do otherwise is 
wasteful and confusing.
    Moreover, the stated purpose of the moratorium is to stop 
regulatory actions that may benefit from future regulatory 
reform legislation. However no regulatory reform bill that the 
Senate is now considering would apply retroactively. So rules 
that are final since November 9, 1994, would not be covered by 
the regulatory analysis requirements proposed under any pending 
reform legislation. Thus, subjecting such rules to a moratorium 
accomplishes nothing, except to suspend the effectiveness of 
the rule for the period of the moratorium.
    Reporting and decision requirements will completely bog 
down the President. The structure that the bill uses is 
cumbersome and one that encourages extensive lobbying 
throughout the life of the moratorium. In order to exempt a 
rule, the agency head must make a determination in writing that 
a rule meets one of the exceptions and then present that 
determination to the President who must then review it and make 
a determination whether or not to support that agency head's 
recommendation. If the President agrees, he must file a notice 
in the Federal Register, stating that a rule has been exempted 
from the moratorium (or, it appears, whether a rule previously 
exempted is no longer exempt). The requirement of monthly 
reports means that the agency heads and the President will be 
routinely lobbied by persons affected by covered rulemakings as 
to whether or not a rulemaking should be in or exempt from the 
moratorium. It is a nightmarish process except from the 
perspective of a lobbyist.
    The five-month extension for deadlines is arbitrary, 
unnecessary, and merely draws out this problematic legislation. 
The Committee bill includes in the moratorium all deadlines 
that have been imposed either by a court or statute with 
respect to a significant regulatory action. Senator Levin 
offered an amendment to strike this section of the bill so that 
statutory and judicial deadlines would not be affected by the 
moratorium. Deadlines are dates that have been set previously 
by statute--passed by both houses of Congress and the 
President--to require that a regulatory action be taken by a 
date certain. Congress did not set those deadlines unwittingly; 
we set them because we were concerned enough about the 
particular situation to place the timing for action into law. 
The Consumer Product Safety Commission rule on choking hazards 
of toys for small children is one such example. Congress passed 
a law in 1994 requiring the CPSC to act by July 1, 1994, on 
rules implementing toy labeling provisions for choking hazards. 
Similarly, we have courts which have set deadlines based on 
extensive legal records and proceedings. As with the issue of 
retroactivity, inclusion of deadlines in the moratorium is 
useless, because many of these deadlines involve rules that are 
already final and have already become effective. Regulatory 
reform legislation will not likely affect these rules.
    Moreover, the Committee bill establishes a new and longer 
time period for the moratorium as it applies to deadlines. The 
moratorium for significant regulatory actions is from November 
9, 1994, to December 31, 1995, but for statutory or judicial 
deadlines, the moratorium extends for five months beyond 
December 31st, to May 31, 1996. The majority states that the 
purpose for the extended deadline is to avoid all the deadlines 
coming into effect at the same time the moratorium is lifted 
from the rulemakings. We do not see the logic in this argument 
nor do we know of one request from an agency that such an 
extended moratorium be provided for deadlines.
    Many of the terms and definitions are unclear and will 
likely compound the problems of unintended consequences. For 
example, the bill's definition of ``significant regulatory 
action'' includes any ``statement of agency policy, guidance, 
guidelines.'' There was no discussion by the majority of what 
this would actually cover. Thus, when the Committee accepted an 
amendment to include in the ``significant'' definition any 
action that ``withdraws or restricts recreational, subsistence, 
or commercial use'' of public land, the majority was unable to 
explain what would or would not be included.
    The Stevens Amendment has wide-reaching, detrimental 
effects for public lands. Meriting separate discussion is the 
amendment by Senator Stevens that the Committee adopted 
concerning Federal agency actions on Federal lands. The Stevens 
amendment added to the definition of ``significant regulatory 
action'' (and thus to coverage of the moratorium) any agency 
action which ``withdraws or restricts recreational, 
subsistence, or commercial use of any land under the control of 
a Federal agency. . . .''
    The Committee had an extensive discussion about the 
amendment in an attempt to fully understand its scope. While 
there was considerable uncertainty during the mark-up as to the 
actual effect of the amendment, subsequent review has 
demonstrated that the scope of the amendment is sweeping and 
would stop not only regulatory actions but virtually all 
enforcement of regulations on Federal lands. That means that 
National Park Service employees would not be able to carry out 
basic management responsibilities in our national parks. The 
Park Service would not be able to prevent hot rods from racing 
in national parks, restrict access to fragile archeological 
sites, or close dangerous passes on snow-covered peaks. As the 
National Parks and Conservation Association has said, ``This 
prohibition against rulemaking effectively eliminates the 
abilities of the Bureau of Land Management, the National Park 
Service, the Fish and Wildlife Service and the Forest Service 
to manage federal lands for resource protection. According to 
the Wilderness Society, ``This sweeping amendment would 
undermine fundamental protections for our national parks, 
national wildlife refuges, national forests, and all other 
public lands.'' The same strong point has been made by other 
conservation and environmental groups. The Committee's adoption 
of the Stevens Amendment demonstrates the lack of understanding 
the Committee had with respect to the full consequences of its 
actions on this bill.

                             3. conclusion

    The Committee hearing on February 22, 1995, and the mark-up 
on March 7 and 9, 1995, highlighted many problems with the 
moratorium proposal. The majority report only compounds these 
issues. In the views above we have again discussed many of 
these issues. Unfortunately, the outlined problems involve only 
those examples that we know of now. We believe there could well 
be many other important rules that would be inadvertently or 
otherwise inappropriately be stopped. The public will be the 
victims of such arbitrary congressional action. The moratorium 
is a bad idea.
    There are most probably many rules that should be examined 
and even rescinded. We would support any reasonable effort to 
target specific regulatory problems areas--again, that is what 
the President is currently doing. We cannot, however, support 
an arbitrary, across-the-board freeze. We should fix the 
regulatory process, we should not freeze it and the benefits 
that flow from it.

                                   John Glenn.
                                   Sam Nunn.
                                   Carl Levin.
                                   David Pryor.
                                   J. Lieberman.
                                   Daniel K. Akaka.
                     viii. changes in existing laws

    In compliance with paragraph 12 of rule XXVI of the 
Standing Rules of the Senate, changes in existing law made by 
S. 219, as reported are as follows: No changes.
                            A P P E N D I X

                              ----------                              

                             Congress of the United States,
                                 Washington, DC, December 12, 1994.
The President,
The White House, Washington, DC.
    Dear Mr. President: On November 8th, the American people 
sent a message to Washington. They voted for a smaller, less 
intrusive government. We urge you to respond to that message by 
issuing an Executive Order imposing a moratorium on all federal 
rulemaking. This moratorium should go into affect immediately 
and remain in effect for the first 100 days of the next 
Congress. During the moratorium, agencies should be directed to 
(1) identify both current and proposed regulation with costs to 
society that outweigh any expected benefits; (2) recommend 
actions to eliminate any unnecessary regulatory burden; (3) 
recommend actions to give state, local, or tribal governments 
more flexibility to meet federally-imposed responsibilities; 
and (4) make this information and the analysis supporting it 
available to Congress.
    The moratorium we are proposing should not apply to all 
regulations. For example, the proposed moratorium should 
specifically exempt regulations that would relax a current 
regulatory burden. Previous moratoriums have exempted several 
types of regulations including those that (1) are subject to a 
statutory or judicial deadline; (2) respond to emergencies such 
as those that pose an imminent danger to human health or 
safety; or (3) are essential to the enforcement of criminal 
laws. It is our hope that you will review past exemption 
categories and use them to guide you in establishing similar 
standards for purposes of administering this moratorium.
    Excessive regulation and red tape have imposed an enormous 
burden on our economy. Private estimates have projected the 
combined direct cost of compliance with all existing federal 
regulations to the private sector and to state and local 
governments at well over $500 billion per year. Your own 
National Performance Review observed that the compliance costs 
imposed by federal regulations on the private sector alone were 
``at least $430 billion per year 9 percent of our gross 
domestic product.'' This hidden tax has pushed up prices for 
goods and services for American families, and limited the 
ability of small businessmen and women to create jobs. The 
Small Business Administration estimates that small businesses 
in this country spend at least a billion hours a year filling 
out government forms.
    The annual Unified Agenda of Federal Regulations, released 
on November 10, 1994, indicates that the Administration 
completed 767 regulations during the past six months and is 
pursuing over 4,300 rulemakings during the next fiscal year. We 
believe this moratorium on new federal regulations would send a 
clear signal that, working together, we intend to ease the 
burden of federal overregulation on consumers and businesses 
that has slowed economic growth and stifled job creation.
    Thank you for your consideration of this request. We look 
forward to working with you to ensure that regulatory policy 
works for the American people, not against them.
            Respectfully,
                                   Trent Lott.
                                   Thad Cochran.
                                   Don Nickles.
                                   Newt Gingrich.
                                   Dick Armey.
                                   Tom DeLay.
                                   John Boehner.
                                ------                                

                 Executive Office of the President,
                           Office of Management and Budget,
                                 Washington, DC, December 14, 1994.
Hon. Don Nickles,
U.S. Senate, Washington, DC.
    Dear Senator Nickles: President Clinton has asked me to 
reply to your letter requesting that he issue an Executive 
order imposing a moratorium on all federal rulemaking.
    As you know, the overwhelming majority of federal 
regulations are mandated by Congress so that federal agencies 
can put into practice your policy decisions. For example, much 
regulatory activity of the Clinton Administration involves 
protecting disabled Americans against discrimination and 
protecting all Americans against the health effects of 
pollution. These regulations are mandated by the Americans With 
Disabilities Act and the Clean Air Act, measures supported by 
Republicans in Congress and signed into law by President Bush.
    President Clinton is concerned about the cost of 
regulations to businesses, individuals, and other governmental 
entities, whether or not those costs are mandated by Congress. 
The President has therefore directed Executive Branch agencies 
to regulate only when necessary, and only in the most cost-
effective manner. The President has also ordered agencies to 
review existing regulations to eliminate rules that are 
duplicative, unnecessary, or not cost-effective.
    Among the changes initiated by the Administration as a 
result of this directive are reforms that will free U.S. 
companies to export their goods overseas without drowning in 
paperwork, and provide the first upgrading in a generation of 
school nutrition standards for student meals. We have also 
opened the regulatory process so that individuals, businesses, 
and governmental entities can know in advance what regulations 
are being proposed and can participate more effectively in 
their development.
    The ``regulatory moratorium'' you have proposed would stop 
rules from being issued regardless of their merit. For example, 
our information about upcoming regulations indicates that this 
``moratorium'' would prevent the Department of Agriculture from 
dealing with tainted meat in the food supply; the Department of 
Veterans Affairs from providing veterans with additional 
assistance for undiagnosed illnesses that may be the result of 
their service in the Persian Gulf War; and the Department of 
Labor from protecting children ages 14-17 from harmful 
conditions in the workplace.
    A moratorium is a blunderbuss that could work in unintended 
ways. When President Bush tried such an approach in his 
Administration, it did not achieve its stated objective of 
reducing the number of federal regulations. In fact, in the 
month immediately after that moratorium, the number of 
regulations actually increased.
    In sum, while we share the view that burdensome regulations 
need to be cut back, we disagree that a blanket moratorium is 
the best way to proceed. We believe that we can work together 
on this issue to achieve a thoughtful solution to this problem.
            Sincerely yours,
                                                      Sally Katzen.

    Identical letters sent to Hon. Robert Dole, Hon. Trent 
Lott, Hon. Thad Cochran, Hon. Newt Gingrich, Hon. Tom DeLay, 
Hon. Dick Armey, and Hon. John Boehner.