[House Report 109-652]
[From the U.S. Government Publishing Office]



109th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES
 2d Session                                                     109-652

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



 
                   TRUTH IN REGULATING ACT EXTENSION

                                _______
                                

 September 13, 2006.--Committed to the Committee of the Whole House on 
            the State of the Union and ordered to be printed

                                _______
                                

  Mr. Tom Davis of Virginia, from the Committee on Government Reform, 
                        submitted the following

                              R E P O R T

                             together with

                            ADDITIONAL VIEWS

                        [To accompany H.R. 1167]

      [Including cost estimate of the Congressional Budget Office]

  The Committee on Government Reform, to whom was referred the 
bill (H.R. 1167) to amend the Truth in Regulating Act to make 
permanent the pilot project for the report on rules, having 
considered the same, report favorably thereon with amendments 
and recommend that the bill as amended do pass.

                                CONTENTS

                                                                   Page
Committee Statement and Views....................................     2
Section-by-Section...............................................     5
Explanation of Amendments........................................     6
Committee Consideration..........................................     6
Rollcall Votes...................................................     6
Correspondence...................................................     7
Application of Law to the Legislative Branch.....................     9
Statement of Oversight Findings and Recommendations of the 
  Committee......................................................     9
Statement of General Performance Goals and Objectives............     9
Constitutional Authority Statement...............................     9
Federal Advisory Committee Act...................................     9
Unfunded Mandate Statement.......................................     9
Committee Estimate...............................................     9
Budget Authority and Congressional Budget Office Cost Estimate...    10
Changes in Existing Law Made by the Bill as Reported.............    11
Additional Views.................................................    13

    The amendments are as follows:
    Strike all after the enacting clause and insert the 
following:

SECTION 1. AMENDMENT TO TRUTH IN REGULATING ACT TO AUTHORIZE ADDITIONAL 
                    3-YEAR PERIOD FOR PILOT PROJECT.

  (a) Additional 3-Year Period for Pilot Project.--Section 6(b) of the 
Truth in Regulating Act of 2000 (Public Law 106-312; 5 U.S.C. 801 note) 
is amended--
          (1) by striking ``The pilot project under this Act'' and 
        inserting the following:
          ``(1) Initial 3 years.--The pilot project under this Act''; 
        and
          (2) by inserting at the end the following:
          ``(2) Additional 3 years.--The pilot project under this Act 
        shall continue for an additional period of 3 years, beginning 
        October 1, 2006, and ending September 30, 2009, if in each 
        fiscal year a specific annual appropriation not less than 
        $5,000,000 shall have been made for the pilot project.''.
  (b) Authorization.--Section 5 of such Act is amended by inserting 
before the period at the end of the text the following: ``, and 
$5,000,000 for each of fiscal years 2007, 2008, and 2009''.
  (c) Technical Amendment.--Section 6(c) of such Act is amended by 
inserting after ``3-year period'' the following: ``under subsection 
(b)(1)''.

  Amend the title so as to read:

      A bill to amend the Truth in Regulating Act to authorize an 
additional period of 3 years for the pilot project for the report on 
rules.

                     Committee Statement and Views


                          PURPOSE AND SUMMARY

    The purposes of the Truth in Regulating Act Amendments are 
to make permanent the pilot program for the report on rules 
from the Truth in Regulating Act of 2000 (P.L. 106-312). The 
Truth in Regulating Act of 2000 (TIRA) was proposed to increase 
the transparency of important regulatory decisions; promote 
effective Congressional oversight to ensure that agency rules 
fulfill statutory requirements in an efficient, effective, and 
fair manner; and increase the accountability of Congress and 
the agencies to the people they serve. The bill would have 
established a Congressional Office of Regulatory Analysis 
(CORA) function within the Government Accountability Office 
(GAO). This regulatory analysis capability was intended to 
enhance Congressional responsibility for regulatory decisions 
developed under the laws Congress enacts. The most basic reason 
for TIRA was to restore balance between the branches of 
government. Just as Congress needs a Congressional Budget 
Office (CBO) to check and balance the Executive Branch in the 
budget process, so it needs an analytic capability to check and 
balance the Executive Branch in the regulatory process.

                  BACKGROUND AND NEED FOR LEGISLATION

    Article I, Section 1 of the U.S. Constitution vests all 
legislative powers in the U.S. Congress. While Congress may not 
delegate its legislative functions, it routinely authorizes 
Executive Branch agencies to issue rules that implement laws 
passed by Congress. Congress has become increasingly concerned 
about its responsibility to oversee agency rulemaking, 
especially due to the extensive costs, benefits and impacts of 
Federal rules.
    The burden of Federal regulations on the American public 
continues to grow. In a report authored under contract to the 
U.S. Small Business Administration's Office of Advocacy, 
Professor Mark Crain of Lafayette College, projected total off-
budget regulatory costs for 2005 to be $1.1 trillion. This was 
an update of studies previously performed in Hopkins (1995) and 
Crain and Hopkins (2001).
    In 2005 alone, the Federal Register published 73,780 pages, 
a significant increase from the time of the original Truth in 
Regulating Act's passage. In recent years, various statutes 
(such as the Unfunded Mandates Reform Act of 1995 and the Small 
Business Regulatory Enforcement Fairness Act of 1996) and 
executive orders (such as President Reagan's 1981 Executive 
Order 12291, ``Federal Regulation,'' and President Clinton's 
1993 Executive Order 12866, ``Regulatory Planning and Review'') 
have mandated that Executive Branch agencies conduct extensive 
regulatory analyses, especially for economically significant 
rules having a $100 million or more effect on the economy or a 
significant impact on small businesses. Unfortunately, Congress 
does not have the analytical capability to independently and 
fairly evaluate these analyses.
    Congress currently has two opportunities to review agency 
regulatory actions. Under the Administrative Procedure Act 
(APA), Congress can comment on agency proposed and interim 
rules during the public comment period. Under the Congressional 
Review Act (CRA), Congress can disapprove an agency final rule 
after it is promulgated but before it is effective. 
Unfortunately, Congress has been unable to fully carry out its 
responsibility under the CRA because it has neither all of the 
information it needs to carefully evaluate agency regulatory 
proposals nor sufficient staff for this function. Therefore, 
since the March 1996 enactment of the CRA, there has been only 
one successful Congressional resolution of disapproval.
    To assume oversight responsibility for Federal regulations, 
Congress needs to be armed with an independent evaluation of 
more than just the agency's regulatory documents, including 
agency-identified alternatives and the agency's costs and 
benefits data. What is needed additionally is an analysis of 
legislative history to see if there is a non-delegation 
problem. Also, Congress needs an identification of non-
regulatory and lower-cost alternatives neglected by the agency.
    During the 105th Congress, multiple hearings were held by 
the Subcommittee on National Economic Growth, Natural 
Resources, and Regulatory Affairs. In the 105th, the Committee 
favorably reported H.R. 1704, the ``Congressional Office of 
Regulatory Analysis Creation Act'' (Rept. 105-441, Part 2). 
This bill, introduced by Small Business Subcommittee Chairwoman 
Sue Kelly on May 22, 1997, called for the establishment of a 
new Legislative Branch Congressional Office of Regulatory 
Analysis (CORA) agency to, among several duties, analyze all 
major rules and report to Congress on potential costs, 
benefits, and alternative approaches that could achieve the 
same regulatory goals at lower costs. This agency was intended 
to aid Congress in analyzing Federal regulations. The Committee 
Report stated, Congress needs the expertise that CORA would 
provide to carry out its duty under the CRA. Currently, 
Congress does not have the information it needs to carefully 
evaluate regulations. The only analyses it has to rely on are 
those provided by the agencies which promulgate the rules.
    In January and February 2000, Government Reform 
Subcommittee Chairman David McIntosh and Small Business 
Subcommittee Chairwoman Kelly introduced bills (H.R. 3521 and 
H.R. 3669, respectively) which established a CORA function 
within GAO, which is an existing Legislative Branch agency. 
These bills and H.R. 4744 respond to the main objection of the 
earlier bill in the 105th Congress by establishing a CORA 
function in an existing Legislative Branch agency instead of 
creating a new agency. GAO is the logical location within the 
Legislative Branch since it already has some responsibilities 
under the CRA. On May 10, 2000, the Senate passed S. 1198, the 
``Truth in Regulating Act of 2000,'' by unanimous consent. It 
also places the CORA function within GAO. Multiple hearings 
were held and witnesses agreed that Congress needs to assume 
more responsibility for regulations, especially for regulatory 
proposals without an explicit delegation of regulatory 
authority from Congress.
    On June 26, 2000, Chairwoman Kelly and Chairman McIntosh 
introduced H.R. 4744, the ``Truth in Regulating Act of 2000,'' 
which included several needed improvements to theSenate-passed 
S. 1198. H.R. 4744 and S. 1198 share nearly identical purposes and very 
similar provisions. However, H.R. 4744 included some needed 
improvements, such as: (a) providing for timely Congressional comment 
on agency proposed rules during the public comment period, while there 
is still an opportunity to influence the cost, scope and content of the 
rule; (b) requiring GAO to review not only the agency's data but also 
the public's data to assure a more complete, unbiased and balanced 
evaluation; (c) including not only rules having a $100 million or more 
effect on the economy but also rules with a significant impact on small 
businesses; (d) clarifying that GAO's evaluation of alternative 
approaches should include alternatives that achieve the same goal in a 
more cost-effective manner or that could provide greater net benefits; 
and, (e) changing procedures so that the bipartisan leadership of 
Congress instead of GAO determines the priority for GAO's independent 
evaluations, with highest priority to proposed and interim rules. S. 
1198 included a pilot project approach to test the effectiveness of a 
CORA function in GAO; in contrast, H.R. 4744 included a sunset 
provision approach. The approach of S. 1198 ultimately prevailed.
    On October 3, 2000, Congress enacted the Truth in 
Regulating Act (TIRA) which was the Senate enacted version S. 
1198. The President signed the bill on October 17, 2000 and it 
became Public Law 106-312, which was intended to improve the 
quality of the information that Congress receives about certain 
rules. Under the final version of TIRA, the chairman or ranking 
member of any committee of jurisdiction could have requested 
that GAO conduct an in-depth review of an agency's estimate of 
a proposed or final economically significant rule's costs and 
benefits, an analysis of the alternatives that the agency 
considered, and the agency's compliance with relevant 
procedural and analytical requirements. Federal agencies were 
required to ``promptly cooperate'' with GAO in carrying out the 
act. TIRA established a three-year pilot project (starting in 
January 2001) that became effective upon the specific annual 
appropriation to GAO of $5.2 million (or the prorated portion 
thereof). Congress never provided that appropriation, though, 
so the three-year pilot project ended in January 2004 without 
being activated.
    In the 108th Congress, Subcommittee on Energy, Natural 
Resources, and Regulatory Affairs Chairman Doug Ose introduced 
the Paperwork and Regulatory Improvements Act (H.R. 2432). The 
act included a provision to make permanent the pilot project on 
regulatory reports in the GAO. The bill passed the House on May 
18, 2004. The legislation was not taken up in the Senate before 
Congress adjourned.
    In the 109th Congress, Representative Sue Kelly introduced 
the Truth in Regulating Act Amendments (H.R. 1167) on March 8, 
2005 to make permanent the pilot project that had expired in 
January 2004. Chairwoman Candice Miller's Subcommittee on 
Regulatory Affairs held a hearing on July 27, 2005 entitled, 
``Regulatory Reform: Are Regulations Hindering Our 
Competitiveness?'' Representative Sue Kelly testified at the 
hearing and discussed the continued need for her legislation. 
She specifically stressed the need for Congress to be able to 
independently evaluate the impacts of regulation on small 
businesses which are disproportionately burdened with the cost 
of regulation.
    The Truth in Regulating Act Amendments will make permanent 
this ability that Congress needs to fulfill its responsibility 
to oversee the laws it has enacted.

                          LEGISLATIVE HISTORY

    The Truth in Regulating Act Amendments (H.R. 1167) was 
introduced by Representative Sue Kelly on March 8, 2005. The 
Subcommittee on Regulatory Affairs held a hearing on several 
legislative proposals for regulatory reform including H.R. 1167 
on July 27, 2005. Witnesses including Representative Kelly 
expressed the continued need for a regulatory review function 
for the Congress within GAO. The legislation would make 
permanent the authority for that program that had yet to be 
implemented since its passing in 2000 (P.L. 106-312). The law 
had authorized the pilot program's existence until January 
2004.
    On June 8, 2006, the Committee on Government Reform held a 
mark up of the Truth in Regulating Act Amendments (H.R. 1167). 
Ranking Member Henry Waxman introduced an amendment in the 
nature of a substitute. The amendment would strike the 
permanent authority for the program and instead extend its 
authority for a 3-year period to begin October 1, 2006 and end 
September 30, 2009. It would also delete a section of the bill 
that would have allowed for the program to be immediately 
implemented by the GAO instead of being contingent on specific 
appropriations being made available. The amendment passed by 
voice vote with no nays. The Committee, with a quorum present, 
reported the bill favorably by rollcall vote, unanimously.

                           Section-by-Section

    An amendment in the nature of a substitute was offered and 
accepted. The amended legislation read as the following:

Section 1. Amendment to Truth in Regulating Act to authorize additional 
        3-year period for pilot project

    Section 1(a) amends the Truth in Regulating Act of 2000 to 
extend of the pilot project for a report on rules by the 
Government Accountability Office for an additional 3-year 
period beginning October 1, 2006 and ending September 30, 2009.
    Section 1(b) amends the Truth in Regulating Act of 2000 to 
authorize appropriations for the office within the Government 
Accountability Office at $5,000,000 for fiscal years 2007-2009.
    Section 1(c) makes technical amendments.

                       Explanation of Amendments

    The amendment in the nature of a substitute eliminated the 
permanent authorization for a report on rules by the Government 
Accountability Office (GAO). Instead, it extended the pilot 
program for a 3-year period. It also continued to make the 
program contingent on a specific appropriation for the GAO at 
an inflation adjusted rate of $5,000,000 per fiscal year. The 
version before the amendment would have required GAO to begin 
operationsof the program without any new funds. GAO submitted 
comments regarding the financial strain this program would cause 
without additional funding. Other operations would have to be scaled 
back to accommodate it.

                        Committee Consideration

    On June 8, 2006, the Committee met in open session and 
ordered reported favorably the bill, H.R. 1167, as amended, by 
voice vote, a quorum being present.

                             Rollcall Votes

    There were no rollcall votes on this legislation. 
    
    
              Application of Law to the Legislative Branch

    Section 102(b)(3) of Public Law 104-1 requires a 
description of the application of this bill to the legislative 
branch where the bill relates to the terms and conditions of 
employment or access to public services and accommodations. 
This bill amends the Truth in Regulating Act of 2000 to extend 
for three years the pilot project that permits a chairman or 
ranking member of a committee of jurisdiction of either House 
of Congress to request the Comptroller General to review a rule 
that is an economically significant rule (a rule with an annual 
effect on the economy of $100 million or more or that will 
adversely affect the country in a material way). As such this 
bill does not relate to employment or access to public services 
and accommodations.
    Legislative branch employees and their families, to the 
extent that they are otherwise eligible for the benefits 
provided by this legislation, have equal access to its 
benefits.

  Statement of Oversight Findings and Recommendations of the Committee

    In compliance with clause 3(c)(1) of rule XIII and clause 
(2)(b)(1) of rule X of the Rules of the House of 
Representatives, the Committee's oversight findings and 
recommendations are reflected in the descriptive portions of 
this report.

         Statement of General Performance Goals and Objectives

    In accordance with clause 3(c)(4) of rule XIII of the Rules 
of the House of Representatives, the Committee's performance 
goals and objectives are reflected in the descriptive portions 
of this report.

                   Constitutional Authority Statement

    Under clause 3(d)(1) of rule XIII of the Rules of the House 
of Representatives, the Committee must include a statement 
citing the specific powers granted to Congress to enact the law 
proposed by H.R. 1167. Article I, Section 8, Clause 18 of the 
Constitution of the United States grants the Congress the power 
to enact this law.

                     Federal Advisory Committee Act

    The Committee finds that the legislation does not establish 
or authorize the establishment of an advisory committee within 
the definition of 5 U.S.C. App., Section 5(b).

                       Unfunded Mandate Statement

    Section 423 of the Congressional Budget and Impoundment 
Control Act (as amended by Section 101(a)(2) of the Unfunded 
Mandate Reform Act, P.L. 104-4) requires a statement whether 
the provisions of the reported include unfunded mandates. In 
compliance with this requirement the Committee has received a 
letter from the Congressional Budget Office included herein.

                           Committee Estimate

    Clause 3(d)(2) of rule XIII of the Rules of the House of 
Representatives requires an estimate and a comparison by the 
Committee of the costs that would be incurred in carrying out 
H.R. 1167. However, clause 3(d)(3)(B) of that rule provides 
that this requirement does not apply when the Committee has 
included in its report a timely submitted cost estimate of the 
bill prepared by the Director of the Congressional Budget 
Office under section 402 of the Congressional Budget Act.

     Budget Authority and Congressional Budget Office Cost Estimate

    With respect to the requirements of clause 3(c)(2) of rule 
XIII of the Rules of the House of Representatives and section 
308(a) of the Congressional Budget Act of 1974 and with respect 
to requirements of clause (3)(c)(3) of rule XIII of the Rules 
of the House of Representatives and section 402 of the 
Congressional Budget Act of 1974, the Committee has received 
the following cost estimate for H.R. 1167 from the Director of 
Congressional Budget Office:

                                                     June 20, 2006.
Hon. Tom Davis,
Chairman, Committee on Government Reform,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed estimate for H.R. 1167, a bill to amend 
the Truth in Regulating Act to authorize an additional period 
of three years for the pilot project for the report on rules.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Matthew 
Pickford.
            Sincerely,
                                          Donald B. Marron,
                                                   Acting Director.
    Enclosure.

H.R. 1167--A bill to amend the Truth in Regulating Act to authorize an 
        additional period of three years for the pilot project for the 
        report on rules

    Summary: H.R. 1167 would amend the Truth in Regulating Act 
to authorize the appropriation of $5 million a year over the 
2007-2009 period for a three-year extension of the Government 
Accountability Office's (GAO's) pilot project to evaluate final 
agency rules that are economically significant. No funds have 
been appropriated for the project, and the authority for the 
pilot project expired on January 15, 2004.
    The rules subject to review by GAO would include those that 
could have an annual effect on the U.S. economy of at least 
$100 million or those that could adversely affect the economy, 
the environment, public health and safety, or state, local, or 
tribal governments. Each GAO analysis would include an 
evaluation of the potential costs and benefits of implementing 
a particular rule, alternative approaches for achieving the 
goal of the rule at a lower cost, and an evaluation of the 
regulatory impact analysis or other assessment performed by the 
agency issuing the rule.
    Assuming appropriation of the authorized amounts and based 
on information from GAO, CBO estimates that implementing the 
pilot project would cost $5 million in 2007 and $15 million 
over the 2007-2011 period. Enacting the bill would not affect 
direct spending or revenues. H.R. 1167 contains no 
intergovernmental or private-sector mandates as defined in the 
Unfunded Mandates Reform Act (UMRA) and would not affect the 
budgets of state, local, or tribal governments.
    Estimated cost to the Federal Government: The estimated 
budgetary impact of H.R. 1167 is shown in the following table. 
The bill would authorize the appropriation of $5 million a year 
over the 2007-2009 period for the pilot project. The costs of 
this legislation fall within budget function 800 (general 
government).

----------------------------------------------------------------------------------------------------------------
                                                                       By fiscal year, in millions of dollars--
                                                                    --------------------------------------------
                                                                       2007     2008     2009     2010     2011
----------------------------------------------------------------------------------------------------------------
                                  CHANGES IN SPENDING SUBJECT TO APPROPRIATION

Authorization Level................................................        5        5        5        0        0
Estimated Outlays..................................................        5        5        5        0        0
----------------------------------------------------------------------------------------------------------------

    Intergovernmental and private-sector impact: H.R. 1167 
contains no intergovernmental or private-sector mandates as 
defined in UMRA and would not affect the budgets of state, 
local, or tribal governments.
    Estimate prepared by: Federal Costs: Matthew Pickford. 
Impact on State, Local, and Tribal Governments: Sarah Puro. 
Impact on the Private Sector: Paige Piper/Bach.
    Estimate approved by: Peter H. Fontaine, Deputy Assistant 
Director for Budget Analysis.

         Changes in Existing Law Made by the Bill, as Reported

  In compliance with clause 3(e) of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows (existing law 
proposed to be omitted is enclosed in black brackets, new 
matter is printed in italic, existing law in which no change is 
proposed is shown in roman):

TRUTH IN REGULATING ACT OF 2000

           *       *       *       *       *       *       *



SEC. 5. AUTHORIZATION OF APPROPRIATIONS.

  There are authorized to be appropriated to the General 
Accounting Office to carry out this Act $5,200,000 for each of 
fiscal years 2000 through 2002, and $5,000,000 for each of 
fiscal years 2007, 2008, and 2009.

SEC. 6. EFFECTIVE DATE AND DURATION OF PILOT PROJECT.

  (a) * * *
  (b) Duration of Pilot Project.--[The pilot project under this 
Act]
        (1) Initial 3 years.--The pilot project under this Act 
        shall continue for a period of 3 years, if in each 
        fiscal year, or portion thereof included in that 
        period, a specific annual appropriation not less than 
        $5,200,000 or the pro-rated equivalent thereof shall 
        have been made for the pilot project.
          (2) Additional 3 years.--The pilot project under this 
        Act shall continue for an additional period of 3 years, 
        beginning October 1, 2006, and ending September 30, 
        2009, if in each fiscal year a specific annual 
        appropriation not less than $5,000,000 shall have been 
        made for the pilot project.
  (c) Report.--Before the conclusion of the 3-year period under 
subsection (b)(1), the Comptroller General shall submit to 
Congress a report reviewing the effectiveness of the pilot 
project and recommending whether or not Congress should 
permanently authorize the pilot project.

           ADDITIONAL VIEWS OF REPRESENTATIVE HENRY A. WAXMAN

    I supported moving H.R. 1167, which sets up a system for 
the Government Accountability Office (GAO) to review agency 
rules, through the Committee, but I do continue to have 
questions about the bill's underlying purpose.
    One key concern I have about the bill, as introduced, is 
its effect. The introduced bill could hurt GAO's ability to 
carry out its primary mission of answering to members of 
Congress. GAO currently does not have adequate resources to 
accept all of its current congressional requests. As it is, 
requests from members without ranking committee positions are 
at the bottom of the priority chain. Adding an unnecessary 
demand on GAO, as this bill seeks to do, could consume 
resources needed elsewhere.
    This concern regarding effect was largely addressed by the 
Waxman amendment, which was unanimously passed in Committee. 
That amendment limits the program to a three year pilot and 
makes the authorization dependent on funding by Congress at $5 
million each fiscal year. Because the Waxman amendment passed, 
I did not oppose H.R. 1167 in Committee.
    However, I continue to have concerns about the purpose of 
this bill. The majority claims imposing this new requirement on 
GAO is necessary in order to allow Congress to oversee what the 
majority characterizes as increasingly burdensome federal 
regulation.
    I am not in favor of burdensome regulations, and I believe 
targeted reviews can be helpful. But the major problem facing 
the regulatory system today is not overly burdensome 
regulation. Rather the two major problems with the regulatory 
process today are that: (1) science is shunted aside whenever 
it is politically inconvenient, as in the case of Plan B, and 
(2) regulatory policy decisions are too often made at the White 
House behind closed doors in meetings with industry, as in the 
case of the Administration's energy policy. This bill does 
nothing to deal with these issues.
    Moreover, Congress already is fully capable of overseeing 
the development of regulations if it chooses to exercise its 
existing authority. Congress can call hearings, require 
agencies to testify, and hear from stakeholders, including the 
public. In addition, it can request agencies to develop 
additional information and fund independent studies by the 
National Academy of Sciences and other widely respected bodies, 
when it believes additional technical information is necessary.

                                                   Henry A. Waxman.

                                  
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