[Federal Register Volume 60, Number 160 (Friday, August 18, 1995)]
[Notices]
[Pages 43108-43117]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-20560]



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ADMINISTRATIVE CONFERENCE OF THE UNITED STATES

Adoption of Recommendations

AGENCY: Administrative Conference of the United States.

ACTION: Notice.

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SUMMARY: The Administrative Conference of the United States (ACUS) 
adopted five recommendations at its Fifty-Second Plenary Session. The 
recommendations concern: (1) Review of Existing Agency Regulations; (2) 
Streamlined Processes for Noncontroversial and Expedited Rulemaking; 
(3) Resolution of Government Contract Bid Protest Disputes; (4) 
Alternative Dispute Resolution Confidentiality and the Freedom of 
Information Act; and (5) Use of Mediation under the Americans with 
Disabilities Act.

FOR FURTHER INFORMATION CONTACT: Jeffrey S. Lubbers, 202-254 7020.

SUPPLEMENTARY INFORMATION: The Administrative Conference of the United 
States was established by the Administrative Conference Act, 5 U.S.C. 
591-596. The Conference studies the efficiency, adequacy, and fairness 
of the administrative procedures used by federal agencies in carrying 
out administrative programs, and makes recommendations for improvements 
to the agencies, collectively or individually, and to the President, 
Congress, and the Judicial Conference of the United States (5 U.S.C. 
594(1)). At its Fifty-Second Plenary Session, held June 15-16, 1995, 
the Assembly of the Administrative Conference of the United States 
adopted five recommendations.

    Recommendation 95-3, ``Review of Existing Agency Rules,'' proposes 
that agencies develop processes for systematically reviewing their 
rules. Such processes should be designed by and tailored to the 
individual agencies. Agencies should set priorities for rule review, 
and provide for public input into the priority-setting process. The 
petition for rulemaking process should be strengthened to ensure 
adequate agency response, but should not be allowed to dominate an 
agency's agenda. Agencies should devote adequate attention and 
resources to the task of reviewing their existing rules.

    Recommendation 95-4, ``Procedures for Noncontroversial and 
Expedited Rulemaking,'' endorses two rulemaking procedures that can 
expedite rules in appropriate cases. Direct final rulemaking is 
appropriate where a rule is expected to generate no significant adverse 
comment, and allows an agency to avoid publishing both a proposed and 
final rule. The Recommendation also proposes that agencies using 
interim final rulemaking should always provide for post-promulgation 
comment, and should always respond to the comments and make any 
necessary modifications. Such post-promulgation procedures should be 
used in all rules where prepromulgation comment is excused under the 
``good-cause'' exemption of 5 U.S.C. 553(b)(3)(B) as ``impracticable'' 
or ``contrary to the public interest.''
    Recommendation 95-5, ``Government Contract Bid Protests,'' proposes 
reexamination of the current jurisdictional arrangements for hearing 
the protests of disappointed seekers of government contracts. The 
recommendation urges that jurisdiction over bid protests, now available 
in four different forums (including the General Accounting Office, the 
General Services Board of Contract Appeals (for contracts involving 
information technology), the federal district courts, and the Court of 
Federal Claims) be streamlined by providing that all protests be heard 
initially in an administrative forum, with judicial review available 
exclusively in the U.S. Court of Appeals for the Federal Circuit. 
Should Congress not wish to consider exclusive appellate-level 
jurisdiction, the Conference alternatively proposes eliminating 
district court jurisdiction in favor of consolidated jurisdiction in 
the Court of Federal Claims. In addition, Recommendation 95-5 urges 
Congress to mandate empirical testing of the effect of the bid protest 
process to analyze the costs and benefits of that process and to 
determine whether it has improved the quality or reduced the cost of 
public procurement; the recommendation suggests several different 
approaches to such a study, among them a pilot study under which an 
agency or agencies would be permitted to conduct some or all 
procurement free of protest controls for a period of years, with the 
results to be compared to procurement conducted under protest controls.
    Recommendation 95-6, ``ADR Confidentiality and the Freedom of 

[[Page 43109]]
     Information Act,'' seeks to deal with a difficulty raised by the 1990 
Administrative Dispute Resolution Act concerning the need for 
confidentiality of some documents generated by ADR proceedings (e.g., 
mediator's notes) and their availability under FOIA. This 
recommendation, based in large part, on a study by Professor Mark 
Grunewald that describes the state of the law and evaluates the need 
for change, calls on Congress to amend the ADR Act's confidentiality 
provisions to make clear that they constitute an exemption from 
disclosure under the FOIA.
    Recommendation 95-7, ``Use of Mediation under the Americans with 
Disabilities Act,'' urges that federal agencies with enforcement 
responsibilities under the Act cooperate to establish a coordinated 
program for voluntary mediation of ADA cases under all titles. The 
recommendation suggests establishing a joint committee to develop the 
program. Use of a common group of trained mediators is suggested to 
handle a variety of disputes arising under the Act, and several 
criteria are listed for evaluating the program.
    The full texts of the recommendations are set out in the Appendix 
below. The recommendations will be transmitted to the affected agencies 
and to appropriate committees of the United States Congress. The 
Administrative Conference has advisory powers only, and the decision on 
whether to implement the recommendations must be made by the affected 
agencies or by Congress.
    Recommendations and statements of the Administrative Conference are 
published in full text in the Federal Register. In past years 
Conference recommendations and statements of continuing interest were 
also published in full text in the Code of Federal Regulations (1 CFR 
Parts 305 and 310). Budget constraints have required a suspension of 
this practice in 1994. However, a complete listing of past 
recommendations and statements is published in the Code of Federal 
Regulations. Copies of all past Conference recommendations and 
statements, and the research reports on which they are based, may be 
obtained from the Office of the Chairman of the Administrative 
Conference. Requests for single copies of such documents will be filled 
without charge to the extent that supplies on hand permit (see 1 CFR 
Sec. 304.2).
    The transcript of the Plenary Session is available for public 
inspection at the Conference's offices at Suite 500, 2120 L Street NW., 
Washington, DC.

    Dated: August 15, 1995.
Jeffrey S. Lubbers,
Research Director.
Appendix--Recommendations of the Administrative Conference of the 
United States

    The following recommendations were adopted by the Assembly of the 
Administrative Conference on Thursday, June 15, 1995.

Recommendation 95-3, Review of Existing Agency Regulations

    Federal agencies generally have systems in place to develop new 
regulations. Once those regulations have been promulgated, the agency's 
attention usually shifts to its next unaddressed issue. There is 
increasing recognition, however, of the need to review regulations 
already adopted to ensure that they remain current, effective and 
appropriate. Although there have been instances where agencies have 
been required to review their regulations to determine whether any 
should be modified or revoked, there is no general process for ensuring 
review of agency regulations.
    The Administrative Conference believes that agencies have an 
obligation to develop systematic processes for reviewing existing 
rules, regulations and regulatory programs on an ongoing basis. If 
Congress determines that such a review program should be mandated, it 
should allow the President and agencies maximum flexibility to design 
processes that are sensitive to individual agency situations and types 
of regulations. Thus, such legislation should assign to the President 
the responsibility for overseeing agency compliance through general 
guidelines that take into account agency resources and other 
responsibilities. The obligation to review existing regulations should 
be made applicable to all agencies, whether independent or in the 
executive branch.
    Given the difference among agencies, however, processes for review 
of existing regulations should not be ``one-size-fits-all,'' but should 
be tailored to meet agencies' individual needs. Thus, the President, as 
well as Congress, should avoid mandating standardized or detailed 
requirements. Moreover, the review should focus on the most important 
regulations and offer sufficient time and resources to ensure 
meaningful analysis. Tight time frames or review requirements 
applicable to all regulations, regardless of their narrow or limited 
impact, may prevent agencies from being able to engage in a meaningful 
effort. It is important that priority-setting processes be developed 
that allow agencies, in consultation with the Office of Management and 
Budget and the public (including but not limited to the regulated 
communities), to determine where their efforts should be directed.
    Public input into the review process is critical. The 
Administrative Procedure Act already provides in section 553(e) for 
petitions for rulemaking, which allow the public to seek modifications 
or revocation of existing regulations as well as ask for new rules. The 
Administrative Conference has in the past suggested some improvements 
in the ways agencies administer and respond to such petitions. See 
Recommendation 86-6, ``Petitions for Rulemaking.'' It suggests, among 
other things, that agencies establish deadlines for responding to 
petitions. The Conference reiterates that recommendation and proposes 
that, if necessary, the President by executive order or the Congress 
should mandate that petitions be acted upon within a specified time, 
for example 12-18 months.
    Although petitions for rulemaking are a useful method for the 
public to recommend to agencies changes it believes are important, such 
petitions should not be allowed to dominate the agency's agenda. 
Agencies have a broad responsibility to respond to the needs of the 
public at large and not all members of the public are equally equipped 
or motivated to file rulemaking petitions. Thus, the petition process 
should be a part, but only a part, of the process for determining 
agency rulemaking priorities, both with respect to the need for new 
regulations and to review of existing regulations. Agencies should also 
develop other mechanisms for public input on the priorities for review 
of regulations, as well as on the impact and effectiveness of those 
regulations.
    Properly done, reviewing existing regulations is not a simple task. 
It may require resources and information that are not readily 
available. Each agency faces different circumstances, depending on the 
number of its regulations, their type and complexity, other 
responsibilities, and available resources. These processes must be 
designed so that they take into account the need for ongoing review, 
the agency's overall statutory responsibilities, including mandates to 
issue new regulations, and other demands on agency resources. Because 
there are relatively few successful well-developed models available and 
no widely accepted methodologies, the Conference recommends that 
agencies experiment with various methods. Such programs might explore 
different 

[[Page 43110]]
approaches with the aim of finding one (or several) that functions 
effectively for the particular agency. Agencies may want to look to 
activities at the state level, as well as the limited federal-level 
experience.
    Review of existing regulations is primarily a management issue. As 
such, agency discretion must be recognized as important and judicial 
review should be limited. Agency denials of petitions for rulemaking 
under the APA are subject to judicial review, but courts have properly 
limited their scope of review in this context. There is no warrant for 
Congress to change current review standards, nor should any regularized 
or systematic program for review of existing regulations be subject to 
greater judicial scrutiny.

Recommendation

I. Review Requirements

    All agencies (executive branch or ``independent'') should develop 
processes for systematic review of existing regulations to determine 
whether such regulations should be retained, modified or revoked. If 
Congress decides to mandate such programs, it should limit that 
requirement to a broad review, assign to the President the 
responsibility for overseeing the review process, and specify that each 
agency design its own program.

II. Focus of Regulation Review

    Systematic review processes should be tailored to meet the needs of 
each agency, focus on the most important regulations, and provide for a 
periodic, ongoing review. The nature and scope of the review should be 
determined by, among other things, the agency's other responsibilities 
and demands on its resources. Sufficient time should be provided to 
allow meaningful information-gathering and analysis.

III. Setting Priorities

    Agencies should establish priorities for which regulations are 
reviewed when developing their annual regulatory programs or plans,\1\ 
and in consultation with OMB and the public. In setting such 
priorities, the following should be considered:

    \1\ See Executive Orders 12,498 (``Regulatory Program'' required 
by President Reagan) and 12,866 (``Regulatory Plan'' required by 
President Clinton).
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    A. whether the purpose, impact and effectiveness of the regulations 
have been impaired by changes in conditions;\2\

    \2\ See (V)(B), infra.
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    B. whether the public or the regulated community views modification 
or revocation of the regulations as important;
    C. whether the regulatory function could be accomplished by the 
private sector or another level of government more effectively and at a 
lower cost; and
    D. whether the regulations overlap or are inconsistent with 
regulations of the same or another agency.
    Agencies should not exclude from their review those regulations for 
which statutory amendment might be required to achieve desired change. 
Agencies should notify Congress of such regulations and the relevant 
statutory provisions.
IV. Public Input

    A. Agencies should provide adequate opportunity for public 
involvement in both the priority-setting and review processes. In 
addition to reliance on requests for comment or other recognized means 
such as agency ombudsmen \3\ and formally established advisory 
committees, agencies should also consider other means of soliciting 
public input. These include issuing press releases and public notices, 
convening roundtable discussions with interested members of the public, 
and requesting comments through electronic bulletin boards or other 
means of electronic communication.

    \3\ See ``The Ombudsman in Federal Agencies,'' ACUS 
Recommendation 90-2.
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    B. The provisions of 5 U.S.C. Sec. 553(e) authorizing petitions for 
rulemaking also provide a method for reviewing existing regulations. 
These provisions should be strengthened to ensure adequate and timely 
agency responses. \4\ Agencies should establish deadlines for their 
responses to petitions; if necessary, the President by executive order 
or Congress should mandate that petitions be acted upon within a 
specified time. Congress should not modify the current limited judicial 
review standard applicable to petitions for rulemaking.

    \4\ See Recommendation 86-6, ``Petitions for Rulemaking.''
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V. Agency Implementation of Regulatory Review Processes

    A. Agencies should provide adequate resources to and ensure senior 
level management participation in the review of existing regulations.
    B. As part of the review process, agencies should review 
information in their files as well as other available information on 
the impact and the effectiveness of regulations and, where appropriate, 
should engage in risk assessment and cost-benefit analysis of specific 
regulations.
    C. In developing processes for reviewing existing regulations, 
agencies should consider:
    1. Frequency of review: Regulations could be reviewed on a pre-set 
schedule (e.g., regulations reviewed every [x] years; a review date set 
at the time a new regulation is issued; regulations subject to 
``sunset'' dates) or according to a flexible priority list.
    2. Categories of regulations to be reviewed: Regulations could be 
reviewed by age, by subject, by affected group, by agencies 
individually or on a multi-agency basis.
    D. Agencies should consider experimenting with partial programs and 
evaluate their effectiveness.

Recommendation 95-4, Procedures for Noncontroversial and Expedited 
Rulemaking

    Rulemaking has been the subject of considerable debate and review 
in recent times. Concern has been expressed that rulemaking processes 
provide adequate opportunity for meaningful public input while allowing 
agencies, in appropriate circumstances, to expedite the implementation 
of rules when they either are needed immediately or are routine or 
noncontroversial. Agencies have experimented with procedures to achieve 
these objectives. Two of these procedures, ``direct final rulemaking,'' 
and ``post-promulgation comment'' rules (also called ``interim final 
rulemaking'') are discussed here.

Direct Final Rulemaking

    Direct final rulemaking is a technique for expediting the issuance 
of noncontroversial rules. It involves agency publication of a rule in 
the Federal Register with a statement that, unless an adverse comment 
is received on the rule within a specified time period, the rule will 
become effective as a final rule on a particular date (at least 30 days 
after the end of the comment period). However, if an adverse comment is 
filed, the rule is withdrawn, and the agency may publish the rule as a 
proposed rule under normal notice-and-comment procedures.\1\

    \1\ When an agency believes that it can incorporate the adverse 
comment in a subsequent direct final rulemaking, it may use the 
direct final rulemaking process again.
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    The process generally has been used where an agency believes that 
the rule is noncontroversial and adverse comments will not be received. 
It allows the agency to issue the rule without having to go through the 
review process twice (i.e., at the proposed and final rule 

[[Page 43111]]
stages),\2\ while at the same time offering the public the opportunity 
to challenge the agency's view that the rule is noncontroversial.

    \2\ Rules are generally reviewed both by the agency and by the 
Office of Information and Regulatory Affairs. Internal agency review 
is often time-consuming. Under current practice, review of direct 
final rules by OIRA would be uncommon, since, under E.O. 12,866, 
only rules deemed to be ``significant'' are subject to review. 
Should this policy be changed, the Conference urges that agency 
rules issued through the direct final rulemaking process be subject 
to no more than one OIRA review.
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    Under current law, direct final rulemaking is supported by two 
rationales. First, it is justified by the Administrative Procedure 
Act's ``good cause'' exemption from notice-and-comment procedures where 
they are found to be ``unnecessary.'' The agency's solicitation of 
public comment does not undercut this argument, but rather is used to 
validate the agency's initial determination. Alternatively, direct 
final rulemaking also complies with the basic notice-and-comment 
requirements in section 553 of the APA. The agency provides notice and 
opportunity to comment on the rule through its Federal Register notice; 
the publication requirements are met, although the information has been 
published earlier in the process than normal; and the requisite advance 
notice of the effective date required by the APA is provided.\3\

    \3\ A separate Federal Register notice stating that no adverse 
comment has been received and that the rule will be effective on a 
date at least 30 days in the future can also be used to further 
alleviate any concern regarding proper advance notice to the public.
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    Because the process protects public comment and expedites routine 
rulemaking, the Administrative Conference recommends that agencies use 
direct final rulemaking in all cases where the ``unnecessary'' prong of 
the good cause exemption is available, unless the agency determines 
that the process would not expedite issuance of such rules. The 
Conference further recommends that agencies explain when and how they 
will employ direct final rulemaking. Such a policy should be issued as 
a procedural rule or a policy statement.\4\

    \4\ The Conference has previously suggested that notice-and-
comment procedures be used for procedural rules where feasible. See 
Recommendation 92-1, ``The Procedural and Practice Rule Exemption 
From APA Notice-and Comment Rulemaking Requirements.''
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    The Conference recommends that agencies publish in the notice of 
the direct final rulemaking the full text of the rule and the statement 
of basis and purpose, including all the material that would be required 
in the preamble to a final rule. The Conference also recommends that 
the public be afforded adequate time for comment.\5\

    \5\ The Conference has previously recommended that the APA be 
amended to ensure that at least 30 days be allowed for public 
comment, while encouraging longer comment periods. Recommendation 
93-4, ``Improving the Environment for Agency Rulemaking,'' para.IV 
and Preamble at p. 5.
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    The direct final rulemaking process is based upon the notion that 
receipt of ``significant adverse'' comment will prevent the rule from 
automatically becoming final. Agencies have taken different approaches 
in defining ``adverse'' comments for this purpose. Some have said that 
a mere notice of intent to file an adverse comment is sufficient. 
Others have required that the comment either state that the rule should 
not be adopted or suggest a change to the rule; proposals simply to 
expand the scope of the rule would not be considered adverse. Some have 
said that a recommended change in the rule would not in and of itself 
be treated as adverse unless the comment states that the rule would be 
inappropriate as published. The Conference recommends that a 
significant adverse comment be defined as one where the commenter 
explains why the rule would be inappropriate, including challenges to 
the rule's underlying premise or approach, or would be ineffective or 
unacceptable without a change. In determining whether a significant 
adverse comment is sufficient to terminate a direct final rulemaking, 
agencies should consider whether the comment raises an issue serious 
enough to warrant a substantive response in a notice-and-comment 
process.
    To assure public notice of whether and when a direct final rule 
becomes effective, agencies should include in their initial Federal 
Register notices a statement that, unless the agency publishes a 
Federal Register notice withdrawing the rule by a specified date, it 
will become effective no less than 30 days after such specified date. 
Alternatively, an agency should publish a separate ``confirmation 
notice'' after the close of the comment period stating that no adverse 
comments were received and setting forth an effective date at least 30 
days in the future. The effective date of the rule should be at least 
30 days after the public has been given notice that the agency does not 
intend to withdraw the rule, unless the rule ``grants or recognizes an 
exemption or relieves a restriction,'' 5 U.S.C. Sec. 553(d)(1), or is 
otherwise exempted from the delayed effective date of section 553(d) of 
the APA. The fact that a rule has proved noncontroversial is not itself 
an appropriate basis for dispensing with the delay in the effective 
date.
    Agencies may also wish to consider using direct final rulemaking 
procedures in some cases where the text of the rule has been developed 
through the use of negotiated rulemaking. Where the course of the 
negotiations suggests that the result will be noncontroversial, the 
direct final rulemaking process offers the opportunity for expedited 
rulemaking while at the same time ensuring that the opportunity for 
comment is not foreclosed.
    Although direct final rulemaking is viewed by the Conference as 
permissible under the APA as currently written, Congress may wish to 
expressly authorize the process. Authorization would alleviate any 
uncertainty and reduce the potential for litigation.

Post-Promulgation Comment Procedures (``Interim Final Rulemaking'')

    Agencies have increasingly used a post-promulgation comment process 
commonly referred to as ``interim final rulemaking'' to describe the 
issuance of a final rule without prior notice and comment, but with a 
post-promulgation opportunity for comment. By inviting comment, the 
agency is indicating that it may revise the rule in the future based on 
the comments it receives--thus leading to the label of an ``interim-
final'' rule.
    Although the process has been used in a variety of contexts, it is 
used most frequently where an agency finds that the ``good cause'' 
exemption of the APA justifies dispensing with prepromulgation notice 
and comment. Recognizing the value of public comment, however, the 
agency offers an opportunity for comment after the final rule has been 
published.\6\ This allows the agency both to issue the rule quickly 
where necessary and provide opportunity for some public comment. On the 
other hand, prepromulgation comment is generally considered preferable 
because agencies are perceived by commenters as more likely to accept 
changes in a rule that has not been promulgated as a final rule--and 
potential commenters are more likely to file comments in advance of the 
agency's ``final'' determination.

    \6\ The Administrative Conference has recommended such post-
promulgation comment opportunity.
    See Recommendation 83-2, ``The `Good Cause' Exemption from APA 
Rulemaking Requirements.''
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    Under current law, agencies must be able to justify use of the good 
cause or other exemptions from notice-and-comment procedures under the 
APA if they are providing only post 

[[Page 43112]]
promulgation comment opportunity. Courts generally have not allowed 
post-promulgation comment as an alternative to the prepromulgation 
notice-and-comment process in situations where no exemption is 
justified. Where a rule is exempt from notice-and comment requirements, 
however, it is still advantageous to provide such procedures, even if 
offered after the rule has been promulgated. Public comment can provide 
both useful information to the agency and enhanced public acceptance of 
the rule.\7\

    \7\ See also Section 202 of the Unfunded Mandates Reform Act of 
1995, Pub. L. 104-2 (to be codified at 2 U.S.C. 1532) (requirement 
for preparing analysis in connection with ``general notice of 
proposed rulemaking'' for rules resulting in non-federal 
expenditures of $100,000,000 or more).
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    The Conference therefore recommends that, where an agency invokes 
the good cause exemption because notice and comment are 
``impracticable'' or ``contrary to the public interest,'' it should 
provide an opportunity for post-promulgation comment.\8\ This 
recommendation does not apply to temporary rules, i.e., those that 
address a temporary emergency or expire by their own terms within a 
relatively brief period, such as rules that close waterways for boat 
races or airspace for air shows.

    \8\ This is consistent with the Conference's long-standing 
position that such opportunity for comment should be offered. See n. 
6, supra, See also Recommendation 90-8, ``Rulemaking and 
Policymaking in the Medicaid Program,'' para.A(2).
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    When using post-promulgation comment procedures in this context, 
agencies should implement the following processes. The agency should 
include in the notice of the rule a request for public comment as well 
as a statement that it will publish in the Federal Register a response 
to significant adverse comments received along with modifications to 
the interim rule, if any. The Conference also suggests that an agency 
generally put a cross-reference notice in the ``Proposed Rules'' 
section of the Federal Register to ensure that the public is notified 
of the request for comment. The agency should then, and as 
expeditiously as possible, respond to any significant adverse comments 
and make any changes that it determines are appropriate. Agencies 
should consider including in the initial notice either a deadline by 
which they will respond to comments and make any appropriate changes or 
a ``sunset'' or termination date for the rule's effectiveness.
    The Conference addresses these recommendations in the first 
instance to the agencies. If they do not implement these proposals, the 
Conference recommends that the President issue an appropriate executive 
order mandating use of post-promulgation comment procedures for rules 
issued under the good cause exemption (except those invoking the 
``unnecessary'' clause). If necessary, or when the APA is otherwise 
reviewed, Congress should amend the APA to include such a requirement.
    The Conference also suggests that agencies consider using similar 
procedures for other rules issued initially without notice and comment, 
such as interpretive rules, procedural rules, or rules relating to 
grants, benefits, contracts, public property, or military or foreign 
affairs functions.\9\ Only for those rules where notice and comment are 
considered unnecessary should such processes not be used; in such 
cases, agencies should consider direct final rulemaking.

    \9\ Recommendation 76-5, ``Interpretive Rules of General 
Applicability and Statements of General Policy.'' Cf. Recommendation 
92-1, ``The Procedural and Practice Rule Exemption From APA Notice-
and-Comment Rulemaking Requirements.''
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    Where an agency has used post-promulgation comment procedures, 
responded to significant adverse comments and ratified or modified the 
rule as appropriate, the Conference suggests that a reviewing court 
generally should not set aside that ratified or modified rule solely on 
the basis that adequate good cause did not exist to support invoking 
the exemption initially. At this stage, the agency's initial flawed 
finding of good cause should normally be treated as harmless error with 
respect to the validity of the ratified or modified rule.

Recommendation

I. Direct Final Rulemaking

    A. In order to expedite the promulgation of noncontroversial rules, 
agencies should develop a direct final rulemaking process for issuing 
rules that are unlikely to result in significant adverse comment. 
Agencies should define ``significant adverse comment'' as a comment 
which explains why the rule would be inappropriate, including 
challenges to the rule's underlying premise or approach, or why it 
would be ineffective or unacceptable without a change. Procedures 
governing the direct final rulemaking process should be established and 
published by each agency.
    B. Direct final rulemaking should provide for the following minimum 
procedures:
    1. The text of the rule and a notice of opportunity for public 
comment should be published in the final rule section of the Federal 
Register,10 with a cross-reference in the proposed rule section 
that advises the public of the comment opportunity.

    \10\ Agencies should also consider other mechanisms for 
providing public notice.
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    2. The notice should contain a statement of basis and purpose for 
the rule which discusses the issues the agency has considered and 
states that the agency believes that the rule is noncontroversial and 
will elicit no significant adverse comment.
    3. The public should be afforded adequate time (at least 30 days) 
to comment on the rule.
    4. The agency's initial Federal Register notice should state which 
of the following procedures will be used if no significant adverse 
comments are received: (a) the agency will issue a notice confirming 
that the rule will go into effect no less than 30 days after such 
notice; or (b) that unless the agency publishes a notice withdrawing 
the rule by a specified date, the rule will become effective no less 
than 30 days after the specified date.11

    \11\ 5 U.S.C. 553(d) provides for exemption from the 30-day 
advance notice where, for example, the rule ``grants or recognizes 
an exemption or relieves a restriction.''
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    5. Where significant adverse comments are received or the rule is 
otherwise withdrawn, the agency should publish a notice in the Federal 
Register stating that the direct final rulemaking proceeding has been 
terminated.12

    \12\ At that point, of course, the agency may proceed with usual 
notice-and comment rulemaking, or if the agency believes it can 
easily address the comment(s), it may proceed with another direct 
final rulemaking.
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    C. Agencies should also consider whether to use direct final 
rulemaking following development of a proposed rule through negotiated 
rulemaking.
    D. If legislation proves necessary to remove any uncertainty that 
direct final rulemaking is permissible under the APA, Congress should 
amend the APA to confirm that direct final rulemaking is authorized.

II. Post-Promulgation Comment Procedures (Interim-Final Rulemaking)

    A. Agencies should use post-promulgation comment procedures (so-
called ``interim final rulemaking'') for all legislative rules that are 
issued without prepromulgation notice and comment because such 
procedures are either ``impracticable'' or ``contrary to the public 
interest.'' 13 5 U.S.C. Sec. 553(b)(3)(B) (``good cause 

[[Page 43113]]
exemption''.14 If necessary, the President should issue an 
appropriate executive order or Congress should amend the APA to include 
such a requirement.

    \13\ This recommendation does not apply to temporary rules, 
meaning those that expire by their own terms within a relatively 
brief period.
    \14\ The Conference does not recommend a change in the coverage 
of the ``good cause'' exemption, but does not oppose a change if 
such a change is understood simply as a codification of existing 
practice.
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    B. When using post-promulgation comment procedures, agencies 
should:
    1. publish the rule and a request for public comment in the final 
rules section of the Federal Register, and, in general, provide a 
cross-reference in the proposed rules section that advises the public 
that comments are being sought.
    2. include a statement in the Federal Register notice that, 
although the rule is final, the agency will, if it receives significant 
adverse comments, consider those comments and publish a response along 
with necessary modifications to the rule, if any.
    3. consider whether to include in the Federal Register notice a 
commitment to act on any significant adverse comments within a fixed 
period of time or to provide for a sunset date for the rule.
    C. Where an agency has used post-promulgation comment procedures 
(i.e., appropriate agency ratification or modification of the rule 
following review of and response to post-promulgation comments), courts 
are encouraged not to set aside such ratified or modified rule solely 
on the basis that inadequate good cause existed originally to dispense 
with prepromulgation notice and comment procedures.
    D. Agencies should consider using post-promulgation comment 
procedures for all rules that are issued without prepromulgation notice 
and comment, including interpretive rules, procedural rules, rules 
relating to contracts, grants etc., or military or foreign affairs 
functions.15
    \15\ However, this recommendation does not apply to rules issued 
under the ``unnecessary'' clause of the good cause exemption; in 
such cases, agencies should consider using direct final rulemaking. 
See Part I, above.
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Recommendation 95-5, Government Contract Bid Protests
    In contrast to the private contracting system, which relies mainly 
on profit maximization and reputation to constrain the discretion of 
private purchasers in dealing with potential sellers, United States law 
provides a variety of opportunities for disappointed seekers of 
government contracts to air their grievances against the contracting 
process and its results. In addition to pursuing redress within the 
purchasing agency, a disappointed offeror can challenge the 
government's conduct in one of four protest forums: the General 
Accounting Office (GAO), the General Services Board of Contract Appeals 
(GSBCA) (for contracts involving automated data processing and 
telecommunications equipment), the federal district courts, and the 
Court of Federal Claims. In no other area of public administration have 
Congress and the courts provided so large and diverse an array of 
avenues for challenging the decisions of government officials.
    This complex system evolved in a number of steps over the last 75 
years. Soon after its creation in 1921, GAO began accepting bid 
protests under its authority to settle and adjust claims involving the 
United States and to issue advisory decisions concerning questions of 
payment by the government. In a series of court opinions from the mid-
1950's to 1970 [most notably the 1970 decision in Scanwell 
Laboratories, Inc. v. Shaffer, 424 F.2d 859 (D.C. Cir. 1970)], the 
federal district courts took on an expanded role in oversight of bid 
protests, and Congress extended authority to grant equitable relief in 
pre-award bid protest cases to the Claims Court (now the Court of 
Federal Claims) in the Federal Courts Improvement Act of 1982. The 
Competition in Contracting Act of 1984 (CICA) completed the foundation 
for the modern bid protest structure. CICA reflected a strong 
congressional presumption that government purchasing agencies should 
use competitive procurement techniques to increase opportunities for 
firms to compete for contract awards. It bolstered the bid protest 
mechanism and increased the ability of complaining offerors to gain 
access to information about the government's decisionmaking process.
    The eleven years that have passed since enactment of that 
legislation provide a basis for reexamination of the Act's premises and 
its impact. In addition, the government procurement process has been 
the subject of much recent study by scholars, professional 
associations, and blue ribbon commissions including the Acquisition Law 
Advisory Panel and the National Performance Review. Congress has also 
given extensive recent consideration to procurement reform. Severe 
budget pressures have inspired several congressional committees to 
consider statutory changes that would reduce procurement transaction 
costs and induce a broader array of firms to compete for government 
contracts. The Federal Acquisition Streamlining Act of 1994, enacted 
last fall, changed many features of procurement regulation and signaled 
a new congressional receptivity to proposals for restructuring the 
procurement process, although it did not significantly change the 
structure of the bid protest process. Legislation introduced this 
spring and supported by the Clinton Administration would, among other 
things, establish a uniform arbitrary-and-capricious standard of review 
for all bid protests and eliminate the jurisdiction of the federal 
district courts. Other legislative initiatives are in development.
    Proposals for reorganizing the bid protest process have been 
numerous and varied, including suggestions for a single administrative 
bid protest forum (one of the existing forums or a new entity), as well 
as for different combinations of existing or new forums. Issues such as 
the appropriate standard of review, available discovery, formality of 
procedure, and availability of a stay of the procurement pending the 
proceedings have also prompted widely varying suggested alternatives. 
Although much attention has been devoted to the bid protest process, 
however, it has been largely theoretical. Without additional, currently 
unavailable empirical information, the Administrative Conference does 
not believe it can recommend a specific design for an ideal forum or 
combination of forums to process bid protests.
    Certain streamlining modifications to the existing system of 
alternatives, however, seem clearly appropriate without further study. 
In particular, the Conference sees no persuasive justification for 
preserving direct court jurisdiction over bid protests. The 
administrative options for hearing bid protests today are considerably 
more substantial than those that existed when Scanwell was decided or 
when Congress granted protest jurisdiction to the Court of Federal 
Claims. Moreover, the factual and legal issues involved in these cases 
are well within the competence of an administrative forum. Provision 
for direct judicial review of administrative protest decisions in the 
Court of Appeals for the Federal Circuit should adequately protect the 
rights of litigants (provided that the administrative decision includes 
clearly stated reasons, so that there will be a record adequate for 
judicial review) and promote the development of a consistent body of 
law related to protests.
    Even if Congress decides to preserve direct recourse to the courts, 
there is no longer a need for initial district court jurisdiction. The 
Court of Federal Claims provides a satisfactory forum for court 
consideration of these cases. The caseload in question is not large 
enough to burden that court unduly, and through travel and, when 
appropriate, 

[[Page 43114]]
 telecommunications, the Court of Federal Claims adequately meets the 
needs of litigants outside of Washington, DC.
    To make wise decisions about the exact type of administrative forum 
(or forums) that should hear bid protests, however, requires empirical 
data on the impact of bid protests on government procurement that is 
not now available. Moreover, these issues raise questions about the 
basic premises underlying the bid protest system. Current law, and many 
of the debates about the number and nature of forums for review of bid 
protests, assume that a robust protest mechanism improves government 
procurement performance by spurring savings-generating competition for 
government contracts and by monitoring the performance of government 
officials who may not exercise discretion to the benefit of taxpayers. 
But there is scant empirical evidence for judging whether public 
purchasing officials are more prone to shirk their responsibility to 
maximize taxpayer interests than private purchasing officials are to 
shirk their responsibility to maximize shareholder interests, or what 
net effect the modern system of protest controls, including CICA and 
related protest reforms, has had on procurement outcomes.
    Fundamental questions about the bid protest process--whether it is 
effective in increasing the efficiency and fairness of government 
procurement, what remedies it should provide to disappointed offerors, 
or what standard of review oversight tribunals (regardless of their 
number or location) should apply--are being debated in this empirical 
void. The Administrative Conference believes that informed decisions on 
these issues require a foundation of detailed empirical research that 
cannot adequately be conducted without Congressional authorization. In 
particular, Congress might pass legislation allowing selected 
government purchasing agencies to conduct business free from protest 
oversight for a period of time, with the results to be compared with 
those at agencies operating under traditional protest controls.\1\ 
Additional avenues of research, including comparison of pre- and post-
Competition in Contracting Act agency procurement, detailed study of 
the impact of GAO or GSBCA review on specific agency procurement, 
examination of state and local approaches to procurement and bid 
protests, or comparison of the procurement activity and results of a 
major government purchasing agency and a major private company 
purchasing department, would be aided significantly by legislative 
authorization to collect data and funding support. With the successful 
completion of such research, Congress and other policy makers would be 
able to make better informed judgments about the need for extensive 
protest oversight of government procurement activity and the proper 
forum and standard of review for any such protest oversight.

    \1\ The pending legislation would authorize the Administrator of 
the Office of Federal Procurement Policy to ``waive any provision of 
law, rule or regulation necessary'' to assist agencies in conducting 
test programs to evaluate specific changes in acquisition policies 
or procedures. S.669, Title V, Section 5001, amending section 15 of 
the Office of Federal Procurement Policy Act (41 USC Sec. 413). This 
broad provision might be read to include authority to waive laws 
requiring the availability of protest mechanisms.
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Recommendation

I. Initial Jurisdiction to Review Bid Protests

    Congress should streamline the system for handling bid protests by 
reducing the alternatives available for initial jurisdiction over bid 
protests.
    A. All bid protests should be heard initially in some 
administrative forum independent of the agency office conducting the 
procurement.\2\ To achieve this end, Congress should eliminate the 
direct jurisdiction of the Court of Federal Claims and of the federal 
district courts over bid protests. The United States Court of Appeals 
for the Federal Circuit should be given exclusive jurisdiction over all 
appeals from administrative bid protest decisions.

    \2\ The Administrative Conference takes no position in this 
recommendation on the preferred structure of, or standard of review 
tobe applied by, such administrative forum(s). The Conference notes, 
however, that if GAO continues to be involved in handling bid 
protests and such cases are directly reviewable in the Court of 
Appeals for the Federal Circuit, the reviewing court would 
effectively review the contracting agency's decision on the 
procurement, as informed by the GAO opinion; to facilitate this 
process, agencies should conclude action on a procurement that has 
been reviewed by the GAO by issuing a clear statement of the 
agency's final determination and the reasons for it.
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    B. If Congress decides, notwithstanding Recommendation I(A), that 
the courts should retain direct jurisdiction over bid protests, then 
such initial court jurisdiction should be consolidated in the Court of 
Federal Claims for both pre-award and post-award protests.

II. Testing Bid Protest Systems

    Congress should mandate empirical testing of the effect of the bid 
protest process to analyze the costs and benefits of that process and 
to determine whether it has improved the quality or reduced the cost of 
public procurement. This analysis should include evaluation of the 
impact of the bid protest process (and any alternatives under 
consideration) on existing and prospective bidders for government 
contracts as well as on the government. It should involve consideration 
of the potential impact of adjustments to the bid protest process (such 
as application of different standards of review of agency procurement 
decisions and imposition of sanctions for the filing of frivolous bid 
protests) as well as examination of the premises underlying the bid 
protest system as a whole. Specific approaches Congress should consider 
supporting include:
    A. Cross-agency comparison--a pilot study in which one or more 
federal agencies that conduct a substantial amount of procurement 
activity would be permitted to conduct procurement with respect to some 
discrete type or types of contracts (e.g., computer or telephone 
equipment contracts) free of most or all bid protest controls for a 
specific period of years (e.g., five years), with the agencies' 
performance to be compared with their own performance before the 
beginning of the pilot and/or on bid protest-controlled contracts 
during the pilot period and with that of agencies continuing to operate 
under the existing bid protest system;
    B. Competition in Contracting Act comparison--a comparison of the 
pre- and post-Competition in Contracting Act procurement experience of 
major government purchasing agencies to identify changes in agency 
behavior and procurement results;
    C. GAO/GSBCA comparison--an examination of specific major 
procurement to determine whether GAO and GSBCA bid protest 
determinations (including the specific procedures available and 
standards of review applied in these forums) have produced desirable 
outcomes in particular procurement and to assess the impact of GAO and 
GSBCA rulings on purchasing agency conduct;
    D. Government/private sector comparison--a comparison between the 
procurement experience of a major government purchasing organization 
and that of a major private company purchasing department to determine 
differences in the outcomes of efforts to purchase comparable goods or 
services over time;
    E. Federal/state comparison--a comparison of federal government 
procurement experience with that of state and local governments that 
may employ procurement oversight 

[[Page 43115]]
mechanisms different in kind or degree from those at the federal level.
    In pursuing any of these options or other studies of the 
procurement system, Congress should assign responsibility for research 
and evaluation to an independent body that is not directly involved in 
conducting major procurement or resolving bid protests. In the case of 
a pilot study, Congress should provide for regular collection of 
appropriate data during the pilot period to permit adequate evaluation.

Recommendation 95-6, ADR Confidentiality and the Freedom of Information 
Act

    The Administrative Dispute Resolution Act (ADRA) accords a 
substantial measure of confidentiality to oral or written 
communications made in a covered dispute resolution proceeding. This 
protection was based upon Administrative Conference Recommendation 88-
11, which recognized that in promoting the use of alternative dispute 
resolution (ADR) in federal agencies ``a careful balance must be struck 
between the openness required for the legitimacy of many agency 
agreements and the confidentiality that is critical if sensitive 
negotiations are to yield agreements.''
    The confidentiality section of the ADRA, 5 U.S.C. 574, consists of 
a detailed set of standards reflecting generally the balance proposed 
in Recommendation 88-11. It is narrow in scope in that it is limited to 
communications prepared for the purposes of a dispute resolution 
proceeding. It does not protect an agreement to enter into a dispute 
resolution proceeding or the agreement or award reached in such a 
proceeding. It does not prevent the discovery or admissibility of 
otherwise discoverable evidence merely because the evidence was 
presented in a dispute resolution proceeding. It does not have any 
effect on the information and data necessary to document or justify an 
agreement reached in a dispute resolution proceeding. It also permits 
disclosure of a dispute resolution communication in special 
circumstances where all parties to the proceeding consent; where the 
communication has already been made public or is required by statute to 
be made public; or where a court determines disclosure is, on balance, 
necessary to prevent a manifest injustice, help establish a violation 
of law, or prevent harm to the public health and safety sufficient to 
justify disclosure.
    In the final stages of the legislative process leading to the 
passage of the ADRA, a question arose as to the relationship between 
the confidentiality section and the Freedom of Information Act (FOIA). 
With the understanding that the importance of passing the dispute 
resolution bill without delay justified an interim solution, a 
provision, subsection 574(j), was added on the Senate floor \1\ 
providing that the confidentiality section would not be considered an 
Exemption 3 statute under FOIA.\2\

    \1\ During this colloquy, Senator Levin summarized as follows: I 
am pleased that we were able, for the purposes of passing this bill 
this year and getting the ADR process rolling, to temporarily 
resolve the confidentiality issue. As the Administrative Conference 
of the United States wrote in its recommendation on this subject, * 
* * since settlements are essential to administrative agencies, a 
careful balance must be struck between the openness required for the 
legitimacy of many agency agreements and the confidentiality that is 
critical if sensitive negotiations are to yield agreements. ts. The 
provisions in this bill, as amended, do not as yet achieve that 
balance, and I am pleased that Senators Grassley and Leahy have 
agreed to address this issue more completely next year. 136 Cong. 
Rec. at S18088 (daily ed. Oct. 24,1990).
    \2\ Under Exemption 3, the FOIA disclosure requirements do not 
apply to matters that are ``specifically exempted from disclosure by 
statute . . . provided that such statute (A) requires that the 
matters be withheld from the public in such a manner as to leave no 
discretion on the issue, or (B) establishes particular criteria for 
withholding or refers to particular types of matters to be 
withheld.''
---------------------------------------------------------------------------

    This last minute addition has created a narrow, but significant, 
problem in accomplishing fully the purposes of the ADRA. In those 
circumstances in which dispute resolution communications become 
``agency records'' within the meaning of FOIA, the confidentiality of 
the records is determined not by the provisions of section 574, but 
rather by the terms of the exemptions to FOIA. For users of ADR, the 
trumping effect of FOIA in this class of cases means that 
confidentiality is not governed by the careful balance struck in 
section 574 but rather by the complex body of FOIA law which accords no 
special protection for dispute resolution communications on the basis 
of the process needs of ADR. While some dispute resolution 
communications that become agency records--for example because they 
come under the control of a government-employee neutral--may be exempt 
from mandatory disclosure under FOIA, the scope of the exemptions and 
possible gaps in coverage create uncertainty as to the confidentiality 
of such records.
    This uncertainty, in turn, has become a disincentive to the use of 
ADR.\3\ Even though the ADRA has been in place for only four years, 
concern about the impact of FOIA on confidentiality has had a chilling 
effect on the use of ADR. This effect could become even more 
substantial if a case arose in which expected confidentiality was 
undermined by a FOIA claim. To accomplish the objectives of 
Recommendation 88-11, the confidentiality standards of section 574 
should be given effect with respect to all covered dispute resolution 
communications, even where those communications become agency records 
under FOIA.\4\

    \3\ Some added uncertainty has been raised by the ADRA's 
protection of ``any information concerning'' a dispute resolution 
communication. The recommendation calls for dropping this language.
    \4\ This recommendation pertains solely to the provisions of the 
ADRA. The Conference recognizes that agencies, in some 
circumstances, conduct similar processes under other authority.
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Recommendation

    1. The confidentiality section of the Administrative Dispute 
Resolution Act, 5 U.S.C. 574, should be amended to provide that records 
confidential under that section and generated by or initially submitted 
to the government in a dispute resolution proceeding are exempt from 
disclosure under the Freedom of Information Act, Exemption 3, 5 U.S.C. 
552(b)(3).
    2. Any alternative confidentiality procedures agreed to by the 
parties and neutral under subsection 574(d) should not, for purposes of 
Exemption 3, be construed to provide broader confidentiality than is 
otherwise available under section 574.
    3. The words ``any information concerning'' should be deleted from 
section 574 (a) and (b).
    The following recommendation was adopted by the Assembly of the 
Administrative Conference on Friday, June 16, 1995.

Recommendation 95-7, Use of Mediation under the Americans with 
Disabilities Act

    Despite the efforts of the agencies charged with enforcing the 
Americans with Disabilities Act (ADA), there are substantial backlogs 
of cases at the investigation stage at many agencies, creating 
unusually lengthy delays in enforcement. Because of enforcement delays, 
many individuals are not obtaining needed relief in a timely manner and 
respondents are not relieved of the burden of pending non-meritorious 
charges. In this era of shrinking government, an influx of significant 
additional public resources for investigation and litigation seems 
unlikely. The Equal Employment Opportunity Commission (EEOC) and the 
Department of Justice have each begun to experiment with alternative 
dispute resolution (ADR) as one approach to reducing backlogs and 

[[Page 43116]]
achieving compliance with the statute.\1\ The Conference believes that 
mediation is the ADR technique that offers greatest immediate promise 
for resolving ADA cases more quickly and to the satisfaction of the 
parties involved, and that agencies with enforcement responsibilities 
under the ADA should offer the opportunity for mediation in appropriate 
cases. Mediation has the potential to preserve relationships between 
the parties and to empower them to take greater responsibility in 
resolving their disputes. In addition compliance with mediated 
settlements is generally high because of the parties' participation in 
developing the solution.

    \1\ The ADA, 42 U.S.C. Sec. 12212, explicitly encourages the use 
of ADR, where appropriate and authorized by law, to resolve disputes 
arising under its provisions. General authority for use of ADR may 
also be found in the Administrative Dispute Resolution Act, 5 U.S.C. 
Sec. 572.
---------------------------------------------------------------------------

    This recommendation is intended to encourage additional efforts to 
implement the use of mediation and to provide guidance on undertaking 
and evaluating a joint program.\2\ The mediation program proposed in 
this recommendation expands on prior agency pilot mediation programs by 
including additional types of cases, and also provides a coordinated 
framework for mediation of ADA cases under all four titles of the 
statute.

    \2\ Though mediation currently appears to be the most promising 
ADR technique for disputes arising under the ADA, the Conference 
encourages examination and experimentation with other ADR 
techniques. See Recommendation 86-3, ``Agencies' Use of Alternative 
Means of Dispute Resolution.''
---------------------------------------------------------------------------

    Because several agencies are charged with enforcement of the 
various titles of the ADA (EEOC, Department of Justice, Department of 
Transportation, and Federal Communications Commission), it is important 
that they jointly participate in designing the recommended mediation 
program. This collaborative effort will minimize costs and maximize 
benefits by using a common group of trained mediators to mediate a 
variety of ADA cases, selected for referral to mediation based on 
criteria established by the agencies. The joint effort should also 
develop sources of mediators who can serve at low cost or pro bono, at 
least at the inception of the program, and should consider ways to 
finance the costs of using mediators where such arrangements cannot be 
made.
    Extensive evaluation of the program pursuant to criteria 
established as part of the program design will enable the agencies to 
gather the information necessary to refine the program so that it is 
used most effectively to resolve disputes at a low cost, in a manner 
that is fair to the parties and consistent with the statute. The 
evaluation should include analysis of the comparative costs of 
mediation, the effectiveness of mediation for different types of 
disputes, the satisfaction level of the participants, the impact on the 
case backlog, the effect on processing time of cases, the impact on 
systemic litigation, consistency of mediated results with the statute, 
and whether mediation disadvantages individuals with disabilities or 
other historically disadvantaged groups.
    Analysis of the program results, along with the results of EEOC and 
Department of Justice pilot mediation programs, should provide the 
information necessary to ensure that mediation is furthering the goal 
of elimination of discrimination against the individuals with 
disabilities. The contemplated evaluation will permit the agencies to 
focus future mediation efforts on those cases where mediation is most 
effective. Additionally, successful experience with agency-sponsored 
mediation may encourage and empower actual or potential parties to use 
private mediation or even negotiation without neutral assistance to 
resolve future disputes, further conserving government and private 
resources.
Recommendation

Coordinated Mediation Program

    1. The Americans with Disabilities Act (ADA) enforcement agencies 
\3\ should establish a joint committee composed of representatives of 
each of the agencies to develop a program for voluntary mediation of 
ADA cases under all titles, in order to achieve the rapid, mutually 
agreeable resolution of disputes over compliance with the requirements 
of the ADA.\4\ This committee also could serve the purpose of improving 
consistency in enforcement of the statute among the agencies. In order 
to assist the joint committee in creating a mediation program that will 
attract participants and meet their needs, the agencies should appoint 
an advisory committee pursuant to the Federal Advisory Committee Act, 
composed of representatives of potential participants, such as 
businesses, state and local government entities, representatives of 
organizations whose purpose is to represent persons with disabilities, 
and civil rights and labor organizations, to provide advice in program 
design.

    \3\ The primary enforcement agencies should be involved in 
establishing the program. These include the Department of Justice, 
Equal Employment Opportunity Commission, Department of 
Transportation, and Federal Communications Commission. Other 
agencies that could provide input into the process, refer cases to 
the program, and participate in the educational effort are the 
Federal Mediation and Conciliation Service and the Title II 
investigative agencies designated in 28 C.F.R. Sec.  35.190: the 
Departments of Agriculture, Education, Health and Human Services, 
Housing and Urban Development, the Interior, and Labor.
    \4\ Since there have been few cases under Title IV, which amends 
the Communications Act to ensure the availability of communication 
by wire or radio for individuals with speech or hearing 
disabilities, there may also be less opportunity to use mediation. 
Also, the FCC's enforcement process differs from those of the other 
ADA enforcement agencies. Nevertheless, efforts should be made to 
include appropriate Title IV cases in the mediation program to 
enable the best possible assessment of mediation's effectiveness.
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    2. The mediation program should follow the broad outlines set forth 
herein, as refined by the agencies' joint committee after consultation 
with the advisory committee. The program should utilize a common group 
of trained mediators to mediate a variety of disputes arising under the 
ADA. The joint committee should determine the criteria for mediator 
participation in the program, considering the pilot projects already 
established, which include mediator training, and the training 
previously conducted by the EEOC and the Department of Justice. If the 
number of trained mediators is insufficient, the agencies should 
jointly conduct or sponsor any necessary training. Mediators must also 
have sufficient knowledge of the various titles of the ADA, familiarity 
with resources for ADA compliance, and knowledge of the impact of 
various disabilities. The joint committee should identify potential 
sources of mediators who are willing to serve pro bono or at low cost, 
at least at the inception of the program, as well as sources of 
technical expertise \5\ to assist in mediation.

    \5\ For example, architects, engineers, or vocational 
rehabilitation experts may be able to serve as mediators, or to act 
as advisers to inform parties of available technical options to help 
resolve disputes.
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    3. The agencies should engage in extensive educational efforts to 
encourage use of the mediation process in a variety of cases and to 
enable unrepresented parties to participate effectively. The 
educational efforts should focus on informing parties and potential 
parties about the process to increase both participation rates and the 
effectiveness of participation.
    4. The agencies should determine the selection criteria for 
referral of cases to mediation, refining and modifying the criteria 
based on evaluation of effectiveness. The agencies should consider 
combining mediation with an early assessment program which will assist 
in determining allocation of resources for investigative processes. 

[[Page 43117]]


Review and Evaluation

    5. The mediation program should incorporate an after-the-fact 
agency review of settlements reached in mediation to examine their 
enforceability, consistency with the ADA, and whether the process 
reduces the time needed to resolve individual cases (both elapsed time 
and person-hours). This review should not result in overturning 
individual mediated settlements, nor should it impair the 
confidentiality of the mediation process or otherwise discourage 
participation in it.
    6. In designing the program, the joint committee should establish 
program objectives, evaluation criteria, and a system for collecting 
the data necessary for evaluation. The evaluation process should be 
designed to provide data and analysis that will enable (i) a 
determination of the circumstances under which mediation is appropriate 
and effective for resolving ADA cases and (ii) the identification of 
any systemic problems that are not addressed by mediated settlements. 
The following issues should be included in the evaluation:
    (a) in what types of cases is mediation most effective?
    (b) at what point in the investigative process is mediation most 
effective, taking into account the costs of any investigation that 
precedes mediation?
    (c) does mediation reduce the cost of processing cases for the 
parties and/or the government?
    (d) what is the effect of mediation on processing time of cases, 
including whether mediation adds to processing time where it is 
unsuccessful?
    (e) what is the impact of mediation on the investigation and case 
backlog?
    (f) what is the satisfaction level of the participants in 
mediation, including separate measures of satisfaction for complainants 
(charging parties) and respondents?
    (g) what are the best sources of qualified mediators?
    (h) is the use of a common group of mediators for various types of 
cases effective, taking into account costs, settlement rates, 
settlement results, and mediator performance?
    (i) how are the costs of using mediators to be financed?
    (j) are the results of mediated settlements, settlements reached 
through other processes, and litigation in similar cases comparable?
    (k) does the mediation program impact systemic litigation?
    (l) is agency review of mediated settlements effective and 
necessary?
    (m) is the process equally fair and effective for represented and 
unrepresented parties?
    (n) are individuals with disabilities disadvantaged in mediation?
    (o) does availability of technical expertise affect settlement 
rates?
    (p) what is the rate of compliance with mediated settlements?
    Additional criteria deemed necessary and appropriate should be 
added by the joint committee designing the program.
    7. The joint committee should review the mediation program 
regularly pursuant to the evaluation criteria and in consultation with 
the advisory committee, modifying the program as suggested by the 
results of the evaluation to ensure its continued effectiveness and 
consistency with statutory goals.

Consideration of Other ADR Techniques

    8. The ADA enforcement agencies should jointly continue to study 
and evaluate other alternative dispute resolution techniques for 
disputes arising under the ADA.\6\

    \6\ See Recommendation 86-3, ``Agencies' Use of Alternative 
Means of Dispute Resolution,'' and the ADA, 42 U.S.C. Sec. 12212.
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[FR Doc. 95-20560 Filed 8-17-95; 8:45 am]
BILLING CODE 6110-01-W