[Federal Register Volume 60, Number 129 (Thursday, July 6, 1995)] [Notices] [Pages 35220-35223] From the Federal Register Online via the Government Publishing Office [www.gpo.gov] [FR Doc No: 95-16547] ======================================================================= ----------------------------------------------------------------------- ADVISORY COMMISSION ON INTERGOVERNMENTAL RELATIONS Criteria for Review of Federal Mandates by the Advisory Commission on Intergovernmental Relations ACTION: Notice of criteria for review of federal mandates. ----------------------------------------------------------------------- SUMMARY: The Advisory Commission on Intergovernmental Relations (ACIR) is issuing criteria for investigating and reviewing existing federal mandates and formulating recommendations to modify, suspend, or terminate specific mandates on State, local, or tribal governments. These criteria were approved by the Commission on June 28, 1995. FOR FURTHER INFORMATION CONTACT: Philip M. Dearborn, Director, Government Finance Research, ACIR, 800 K Street, NW, Suite 450 South, Washington, DC 20575, phone (202) 653-5538, FAX (202) 653-5429. SUPPLEMENTARY INFORMATION: The Advisory Commission on Intergovernmental Relations (42 U.S.C. 4271) is charged in Section 302 of the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4, 109 Stat. 48) with investigating and reviewing the role of Federal mandates in intergovernmental relations [Sec. 302(a)(1)] and with making recommendations for improving the operation of mandates [Sec. 302(a)(3)]. The law defines ``Federal mandate'' very broadly for the purposes of the ACIR review as ``any provision in statute or regulation or any Federal court ruling that imposes an enforceable duty on State, local, or tribal governments including a condition of Federal assistance or a duty arising from participation in a voluntary Federal program.'' For purposes of reviewing the role of Federal mandates under Sec. 302(a)(1), ACIR will take into account the positive attributes of mandates and the rationale for their adoption, as well as the characteristics of mandates that present problems. For purposes of making the recommendations required under Section 302(a)(3), ACIR will select for review only Federal mandates that are generally recognized as creating significant concerns within the intergovernmental system. In accordance with Public Law 104-4, ACIR will give review priority to mandates that are subject to judicial proceedings in Federal courts. Prior to making recommendations under Sec. 302(a)(3), the Commission is required to issue criteria. The following criteria will fulfill that requirement. They were approved by the Commission on June 28, 1995, following public comment on proposed criteria published in 60 FR 27324 on May 23, 1995. The Commission will make the final decisions about which mandates it will review and what recommendations it will make. The Commission's decisions will be based on two types of criteria: (1) Those that provide a basis for identifying mandates of significant concern; and (2) Those that provide a basis for formulating recommendations to retain, modify, suspend, or terminate specific mandates that are concern. These criteria are intended solely to help the Commission make its recommendation. Criteria for Identifying Mandates of Significant Concern In general, Federal mandates will be selected for intensive review if they have one or more of the following characteristics: 1. The Mandate Requires State, Local, or Tribal Governments to Expend Substantial Amounts of Their Own Resources in a Manner That Significantly Distorts Their Spending Priorities This addresses mandates that require more than incidental amounts of spending. It will not include all Federal mandates that require governments to spend money. 2. The Mandate Establishes Terms or Conditions for Federal Assistance in a Program or Activity in Which State, Local, or Tribal Governments Have Little Discretion Over Whether or Not to Participate This will include mandates in entitlements and discretionary programs. It will exclude conditions of grants in small categorical programs that are distributed on the basis of annual or periodic applications and that are received only by a limited number of governments unless the conditions effectively limit access to such programs by small governments. 3. The Mandate Abridges Historic Powers of State, Local, or Tribal Governments, the Exercise of Which Would Not Adversely Affect Other Jurisdictions This will include mandates that have an impact on internal State, local, and tribal government affairs related to issues not widely acknowledged as being of national concern and for which the absence of the mandate would not create adverse spillover effects. This also will include mandates that abridge the powers of State, local, or tribal governments to impose taxes within the limits of the U.S. Constitution and that provide particular tax treatment to particular classes of taxpayers. [[Page 35221]] 4. The Mandate Imposes Compliance Requirements That Make it Difficult or Impossible for State, Local, and Tribal Governments to Implement Implementation delays, issuance of court orders, or assessment of finds may be indicative of mandate requirements that go beyond State, local, or tribal fiscal resources, or administrative or technological capacity, after reasonable efforts at compliance have been made. 5. The Mandate has Been the Subject of Widespread Objections and Complaints by State, Local and Tribal Governments and Their Representatives This will include mandates that are based on problems of national scope, but are not Federally funded. Criteria for Formulating Recommendations ACIR will investigate the specific characteristics of each Federal mandate causing significant concern in order to formulate specific recommendations, ACIR also will consider the beneficial and non- beneficial effects of mandates. For purposes of formulating such recommendations, ACIR will focus on specific provisions in laws, regulations, or court orders. When a mandate affects a State, local, or tribal program that directly competes with a comparable private sector activity, ACIR will consider the effects of the mandate and the Commission recommendation on both the government and private sector. ACIR also will consider (1) impacts of mandates on working men and women and (2) mandates for utilization of metric systems. ACIR will investigate each mandate selected for intensive review to determine whether or not they have one or more of the following characteristics that should be considered by ACIR in making its recommendations: 1. Federal IntrusionRequirements are not based on demonstrated national needs. Requirements are related to issues not widely recognized as national concerns or as being within the appropriate scope of Federal activities. Requirements are based on problems of national scope, but which State, local, or tribal governments have demonstrated ability or willingness to solve effectively, either independently or through voluntary cooperation. Requirements are based on problems of national scope, but are not Federally funded. These mandates should be terminated, retained, funded, or modified to express non-binding national guidelines. 2. Unnecessarily Rigid Provisions do not permit adjustments to the circumstances or needs of individual jurisdictions. Provisions restrict flexibility to use less costly or less onerous alternative procedures to achieve the goal of the mandate. Provisions do not allow governments to set implementation or compliance priorities and schedules, taking into account risk analysis, greatest benefit, local capacity, or other factors. These mandates should be modified to provide options, waivers, or exemptions, or be terminated. 3. Unnecessarily Complex or Prescriptive Requirements are unnecessarily detailed and difficult to understand. Provisions are too process-specific rather than results- oriented. These mandates should be simplifed, clarified, or otherwise revised to facilitate understanding and implementation, or be terminated. 4. Unclear Goals or Standards Goals or standards are too vague, confusing, or poorly written to permit clear or consistent implementation of requirements or measurement of results. These goals or standards should be rewritten or the mandate should be terminated. 5. Contradictory or Inconsistent Provisions in one mandate may make it difficult or impossible to comply with other provisions in the same or other Federal, State, local, or tribal laws. Requirements use conflicting and confusing definitions and standards. These mandates should be modified to bring conflicting requirements into conformance. In some instances, it may be appropriate to terminate one or all of the requirements. Where possible, common definitions and standards should be used, especially in planning and reporting requirements. 6. Duplicative Provisions in two or more Federal mandates may have the same general goals but require different actions for compliance. These mandates could be terminated, consolidated, or modified to facilitate compliance. 7. Obsolete Provisions were enacted when conditions or needs were different or before existing technologies were available. Provisions have been superseded by later requirements. These mandates should be modified to reflect current conditions or existing technology. If a mandate is no longer necessary or has been superseded, it should be terminated. 8. Inadequate Scientific and Economic Basis Provisions were enacted based on inadequate or inconclusive scientific research or knowledge. Provisions are not based on current, peer-reviewed scientific research, when applicable. Provisions are not justified by appropriate risk assessment or cost-benefit studies. These mandates should be terminated or modified to reflect current science. In some cases, suspension of the mandate may be appropriate to provide time for additional research. 9. Lacking in Practical Value Requirements do not achieve the intended results. Requirements are perceived by citizens as unnecessary, insignificant, or ineffective, thereby producing credibility problems for governments. Requirements have high costs relative to the importance of the issue. These mandates should be evaluated to determine whether or not they are effective. If they cannot be shown to be effective and worthy of public support, they should be terminated. If they are effective, it still may be appropriate to suspend the mandates to allow time for public education and consensus building on their value. 10. Resource Demands Exceed Capacity Requirements for compliance exceed State, local, and tribal governments' fiscal, administrative, and/or technological capacity. These mandates should be terminated or modified to reduce compliance problems, or assistance could be provided to upgrade capacity. In some instances, compliance schedule extensions or exemptions may be appropriate. 11. Compounds Fiscal Difficulties Compliance with the requirements of any one mandate or with multiple mandates compounds fiscal difficulties of governmental jurisdictions that are experiencing fiscal stress. In these situations, certain of the mandates affecting the jurisdictions--exclusive of those that are vital to public health or safety--should be considered [[Page 35222]] for partial or total suspension until the government experiencing fiscal stress is able to comply. The conditions triggering considerations of such suspensions should include: a. Governments faced with costs dramatically out of line with their revenue bases, as determined by comparisons with other similar governments that are complying. This may result from local and tribal governments experiencing fiscal stress due to depopulation, loss of tax base, or inability to raise matching funds from user fees due to low average household income or small population base; or b. Governments that are experiencing severe fiscal distress for reasons not immediately within their control. There should be some definitive evidence of severe problems, such as State receivership, State declaration of distress, Chapter 9 bankruptcy, or a debt rating below investment grade. This should not include annual budget balancing problems. Responses to Comments Received In response to ACIR's notice of proposed criteria (60 FR 27324, May 23, 1995), comments were received from 20 individuals or organizations. ACIR considered all of the comments and incorporated those suggestions it found would aid in carrying out the studies directed by the Congress. Several commentators misunderstood the purpose of the criteria, expressing concerns that they would be used to delay the approval of laws or regulations, or to provide a legal basis for challenging the implementation of mandates. The Commission added a statement to the introduction to make it clear that the criteria are solely designed to aid ACIR in this formulation of recommendations to the President and Congress. The criteria, as such, will not alter existing legislative or regulatory procedures. Several commentators found that the criteria focused only on problems caused by mandates and did not recognize their positive results. They suggested that the criteria should evaluate positive benefits that may offset negative effects. In response, the Commission has added a paragraph in the introduction to make it clear that for its Section 302(a)(1) investigation and review of the role of federal mandates in intergovernmental relations, it will take into account the beneficial effects as well as the problems created by mandates as they are currently formulated. The benefits of mandates will also be examined for feasibility of quantification under the baseline study required by Section 301(b). In addition, a statement was added to the introduction of the section on criteria for formulating recommendations that beneficial effects will be considered when making recommendations because of problems revealed by the criteria. Commentators also pointed out that in addition to modification, suspension, or termination, the Commission could recommend retention of a mandate. The list of possible recommendations in the introduction has been amended to add ``retain'' as an option. Several commentators were concerned that some terms in the criteria as not well defined and are subject to different interpretations. The final responsibility for determining the application and interpretation of the criteria in making recommendations will be left to the judgment of the Commission. The language in the fifth paragraph of the introduction has been amended to clarify that this is a Commission responsibility. A commentator was concerned that the effects of State mandates would be difficult to separate from the effects of Federal mandates, and some Federal mandates may be welcomed. While it may be difficult to make such separations, no change in the criteria seem necessary to address this problem. One commentator expressed concern that to exclude from review conditions of discretionary grants in small categorical programs could overlook the burdensome nature of grant requirements on small rural governments. To correct this concern, the criteria for selecting mandates of significant concern has been modified to include any mandates that would have the practical effect of limiting small governments' access to aid. One commentator suggested that the criterion identifying mandates that abridge historic powers should specifically include those that affect state and local tax powers that are otherwise Constitutional. This was added to the criterion. A suggestion was made to add ``tribal'' to state and local governments in the fifth criterion for identifying mandates. This omission has been corrected. Several commentators were concerned that under the criterion of federal intrusion the suggested actions included only making the mandates voluntary or terminating them. Wording was added to provide the alternative of retaining the mandate and providing federal funding of the mandate. Several commentators suggested that the criterion ``Inadequate Scientific Basis'' could be inimical to health by enabling the repeal or restriction of health or environmental reforms because it is so broad and subject to interpretation. There were also questions raised about its applicability in some situations. Finally, it was noted that the reference to cost-benefit studies is an economic concern, not a scientific one. Several changes were made as a result of these comments, including addition of ``economic'' to the title, addition of ``when applicable'' after ``peer-reviewed scientific research''; and addition of ``appropriate'' before ``risk-assessment.'' The concerns that this criterion might delay or otherwise interfere with legislation or regulations was addressed earlier in the explanation that these criteria are only for use by ACIR in formulating its recommendations. A comment was received that Section 4 of the Act would exclude certain mandates from Commission review, even though they would otherwise qualify for review under the definition in Section 305. Section 4 exclusions apply only to mandates that are before the Congress or in a proposed or final federal regulation. Another commentator suggested that legislated mandates that had been confirmed by the U.S. Supreme Court should be beyond the scope of Commission review. Because of the clear intent of the law is to require ACIR to consider mandates established by statute or court orders, no change has been made in the criteria. One commentator suggested deleting all the criteria proposed for selecting mandates of significant concern, and relying on the criteria for making recommendations to determine which mandates are to be reviewed. The first set of criteria serve the purpose of avoiding a very detailed review of every existing grant and mandate, and they have been kept. The second set of criteria will then be applied only to those mandates selected for more detailed review. One commentator expressed concern that the criterion on compounding fiscal difficulties was not specific enough to encompass some situations being experienced by small rural governments and Indian tribes. Additional explanatory language was added to clarify situations in which the criterion might apply. A commentator suggested that in making its recommendations ACIR address the cumulative cost effects of multiple federal mandates, especially on small governments. Estimating cumulative cost effects will not be feasible in this study, but will be considered as a part of the [[Page 35223]] Commission's Section 301 Baseline Study. Dated: June 28, 1995. William E. Davis III, Executive Director. [FR Doc. 95-16547 Filed 7-5-95; 8:45 am] BILLING CODE 5500-01-M