Reexamining Regulations: Opportunities Exist to Improve
Effectiveness and Transparency of Retrospective Reviews
(16-JUL-07, GAO-07-791).
Congress and presidents require agencies to review existing
regulations to determine whether they should be retained,
amended, or rescinded, among other things. GAO was asked to
report the following for agency reviews: (1) numbers and types
completed from 2001 through 2006; (2) processes and standards
that guided planning, conducting, and reporting; (3) outcomes;
and (4) factors that helped or impeded in conducting and using
them. GAO evaluated the activities of nine agencies covering
health, safety, environmental, financial, and economic
regulations and accounting for almost 60 percent of all final
regulations issued within the review period. GAO also reviewed
available documentation, assessed a sample of completed reviews,
and solicited perspectives on the conduct and usefulness of
reviews from agency officials and knowledgeable nonfederal
parties.
-------------------------Indexing Terms-------------------------
REPORTNUM: GAO-07-791
ACCNO: A72708
TITLE: Reexamining Regulations: Opportunities Exist to Improve
Effectiveness and Transparency of Retrospective Reviews
DATE: 07/16/2007
SUBJECT: Administrative law
Documentation
Executive orders
Federal regulations
General management reviews
Regulatory agencies
Reporting requirements
Standards
Policy evaluation
Strategic planning
Transparency
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GAO-07-791
* [1]Results in Brief
* [2]Background
* [3]All Selected Agencies Reviewed Existing Regulations, but the
* [4]Agencies Conducted Most Reviews on Their Own Discretion Rath
* [5]Agency Officials Reported that They Most Often Conducted Rev
* [6]Agencies Varied in the Extent to Which They Used Formal Proc
* [7]Agencies Employed Standards-Based Approaches More Often in M
* [8]Level of Public Participation Varied by Impetus and Phase of
* [9]The Level of Documentation in Agencies' Reviews Varied Depen
* [10]Reviews Resulted in a Variety of Outcomes that Were Consider
* [11]Agencies and Nonfederal Parties Identified Barriers and Faci
* [12]Time, Resources, and Information Were Among the Critical Bar
* [13]Information and Data Limitations Present Challenges to the C
* [14]Barriers to the Usefulness of Reviews Included Overlapping a
* [15]Overlapping Schedules and Review Factors
* [16]Scope of Reviews
* [17]Statutory Provisions
* [18]Limited Public Participation
* [19]Shortcomings in Transparency
* [20]Agencies and Nonfederal Parties Identified Lessons Learned a
* [21]Some Agencies Believe Retrospective Reviews Can Result in Co
* [22]Conclusions
* [23]Recommendations for Executive Action
* [24]Matters for Congressional Consideration
* [25]Agency Comments
* [26]Appendix I: Objectives, Scope and Methodology
* [27]Objectives
* [28]Scope
* [29]Methodology
* [30]Appendix II: Department of Agriculture Retrospective Reviews
* [31]USDA Retrospective Reviews
* [32]USDA Retrospective Review Processes
* [33]Appendix III: Department of Justice Retrospective Reviews
* [34]DOJ Retrospective Review Activity
* [35]DOJ Review Process
* [36]Appendix IV: Department of Labor Retrospective Reviews
* [37]DOL Retrospective Review Activity
* [38]DOL Retrospective Review Processes
* [39]Appendix V: Department of Transportation Retrospective Revie
* [40]DOT Retrospective Review Activity
* [41]DOT Retrospective Review Process
* [42]Appendix VI: Consumer Product Safety Commission Retrospectiv
* [43]CPSC Retrospective Review Activity
* [44]CPSC Review Process
* [45]Appendix VII: Environmental Protection Agency Retrospective
* [46]EPA Retrospective Review Activities
* [47]EPA Review Process
* [48]Appendix VIII: Federal Communications Commission Retrospecti
* [49]FCC Retrospective Review Activity
* [50]FCC Review Process
* [51]Appendix IX: Federal Deposit Insurance Corporation Retrospec
* [52]FDIC Retrospective Reviews
* [53]FDIC Retrospective Review Process
* [54]Appendix X: Small Business Administration Retrospective Revi
* [55]SBA Retrospective Review Activities
* [56]SBA Retrospective Review Process
* [57]Appendix XI: Department of Labor's Employee Benefit Security
* [58]Appendix XII: Comments from the Small Business Administratio
* [59]Appendix XIII: GAO Contact and Acknowledgments
* [60]GAO Contact
* [61]Acknowledgments
* [62]Order by Mail or Phone
Report to Congressional Requesters
United States Government Accountability Office
GAO
July 2007
REEXAMINING REGULATIONS
Opportunities Exist to Improve Effectiveness and Transparency of
Retrospective Reviews
GAO-07-791
Contents
Letter 1
Results in Brief 4
Background 9
All Selected Agencies Reviewed Existing Regulations, but the Purposes of
the Reviews Varied 13
Agencies Varied in the Extent to Which They Used Formal Processes and
Standards for Selecting, Conducting, and Reporting on Retrospective
Reviews 21
Reviews Resulted in a Variety of Outcomes that Were Considered Useful, but
Mandatory Reviews Most Often Resulted in No Change 30
Agencies and Nonfederal Parties Identified Barriers and Facilitators to
the Conduct and Usefulness of Retrospective Reviews 35
Conclusions 49
Recommendations for Executive Action 53
Matters for Congressional Consideration 55
Agency Comments 55
Appendix I Objectives, Scope and Methodology 57
Appendix II Department of Agriculture Retrospective Reviews 62
Appendix III Department of Justice Retrospective Reviews 66
Appendix IV Department of Labor Retrospective Reviews 71
Appendix V Department of Transportation Retrospective Reviews 77
Appendix VI Consumer Product Safety Commission Retrospective Reviews 82
Appendix VII Environmental Protection Agency Retrospective Reviews 86
Appendix VIII Federal Communications Commission Retrospective Reviews 90
Appendix IX Federal Deposit Insurance Corporation Retrospective Reviews 95
Appendix X Small Business Administration Retrospective Reviews 98
Appendix XI Department of Labor's Employee Benefit Security Administration
Example of a Documented Formal Review 101
Appendix XII Comments from the Small Business Administration Office of
Advocacy 106
Appendix XIII GAO Contact and Acknowledgments 115
Tables
Table 1: Impetus for Mandatory and Discretionary Reviews Conducted Between
2001 and 2006 16
Table 2: Retrospective Reviews for which Results Were Reported 2001-2006,
for Selected Agencies 17
Table 3: Examples of Overlapping Timing and Review Factors in
Retrospective Review Requirements 41
Table 4: Description of USDA Retrospective Reviews 63
Table 5: Description of DOJ Retrospective Reviews 68
Table 6: Description of DOL Retrospective Reviews 73
Table 7: Description of DOT Retrospective Reviews 79
Table 8: Description of CPSC Retrospective Reviews 83
Table 9: Description of EPA Retrospective Reviews 87
Table 10: Description of FCC Retrospective Reviews 91
Table 11: Description of FDIC Retrospective Reviews 96
Table 12: Description of SBA Retrospective Reviews 98
Figures
Figure 1: Agencies' Use of Standards-based Approaches in the Review
Process, for Discretionary and Mandatory Reviews 25
Figure 2: Agencies' Incorporation of Public Involvement in the Review
Process, for Discretionary and Mandatory Reviews 27
Figure 3: Agencies' Documentation of the Review Process, for Discretionary
and Mandatory Reviews 29
Figure 4: Modifications to Rules Listed in the December 2006 Unified
Agenda by Type of Review for Selected Agencies 33
Figure 5: USDA Review Process 65
Figure 6: ATF Section 610 Review, Explosive Materials in the Fireworks
Industry 70
Figure 7: EBSA Retrospective Review Process 75
Figure 8: OSHA Retrospective Review Process 76
Figure 9: Illustration of DOT's Review Programa 81
Figure 10: CPSC Retrospective Review Process 85
Figure 11: EPA Retrospective Review Process 89
Figure 12: FCC Retrospective Review Processes 94
Figure 13: FDIC Retrospective Review Process 97
Figure 14: SBA's General Retrospective Review Process 100
Abbreviations
AMS Agricultural Marketing Service
APHIS Animal and Plant Health Inspection Service
ATF Bureau of Alcohol, Tobacco, Firearms, and Explosives
CFR Code of Federal Regulations
CPSC Consumer Product Safety Commission
RA Congressional Review Act
DEA Drug Enforcement Administration
DOJ Department of Justice
DOL Department of Labor
DOT Department of Transportation
EBSA Employee Benefits Security Administration
EGRPRA Economic Growth and Regulatory Paperwork Reduction Act
EPA Environmental Protection Agency
ETA Employment and Training Administration
FAA Federal Aviation Administration
FCC Federal Communications Commission
FDIC Federal Deposit Insurance Corporation
FFIEC Federal Financial Institutions Examination Council
FSIS Food Safety and Inspection Service
FTE full-time equivalent
GPRA Government Performance and Results Act of 1993
MSHA Mine Safety and Health Administration
NHTSA National Highway Traffic Safety Administration
OIRA Office of Information and Regulatory Affairs
OMB Office of Management and Budget
OSHA Occupational Safety and Health Administration
PART Program Assessment Rating Tool
PRA Paperwork Reduction Act
RFA Regulatory Flexibility Act
SBA Small Business Administration
SEISNOSE significant economic impact upon a substantial number
of small entities
USDA Department of Agriculture
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separately.
United States Government Accountability Office
Washington, DC 20548
July 16, 2007
The Honorable Joe Barton
Ranking Member
Committee on Energy and Commerce
House of Representatives
The Honorable Ed Whitfield
Ranking Member
Subcommittee on Oversight and Investigations
Committee on Energy and Commerce
House of Representatives
Regulation is a basic tool of government. Each year, federal agencies
issue thousands of regulations to ensure public health and safety, protect
the environment, and facilitate the effective functioning of financial
markets, among other goals. The total costs of these regulations are
estimated to be in the hundreds of billions of dollars, and the estimated
benefits are even higher. Congress and presidents have imposed many
procedural and analytical requirements on the regulatory process, in part,
because of the substantial costs and benefits of regulations. The
requirements focus predominately on agencies' development of new rules,
but some, such as Section 610 reviews required by the Regulatory
Flexibility Act (RFA),1 call for the evaluation of existing regulations.
Such evaluations can be done through a variety of activities that may be
considered retrospective regulatory reviews.2 For purposes of this report,
we generally use the term retrospective review to mean any assessment of
an existing regulation, primarily for purposes of determining whether (1)
the expected outcomes of the regulation have been achieved; (2) the agency
should retain, amend, or rescind the regulation; and/or (3) the actual
benefits and costs of the implemented regulation correspond with estimates
prepared at the time the regulation was issued. We have reported that
federal and nonfederal stakeholders and experts identified such
evaluations as highly desirable and potentially useful but, at the same
time, recognized that they may be difficult to do.3
1Pub. L. No. 96-354, 94 Stat. 1164, 1169 (Sept. 16, 1980) codified at 5
U.S.C. S 610. These reviews are referred to as Section 610 reviews.
2There is no one standard term or definition for the variety of activities
that might be considered retrospective regulatory reviews. In different
contexts, these have been referred to as look-backs, ex post
(postregulation) studies, retrospective studies, validation studies, and
sometimes just as "reviews."
To provide insights concerning how agencies evaluate existing regulations,
you requested that we examine agencies' implementation of retrospective
regulatory reviews and the results of such reviews. For selected agencies,
we are reporting on:
1) the magnitude of retrospective review activity and type of
retrospective reviews agencies completed from calendar year 2001
through 2006, including the frequency, impetus (mandatory or
discretionary), and purposes of the reviews;
2) the processes and standards that guide agencies' planning,
conducting, and reporting on reviews, and the strengths and
limitations of the various review processes and requirements;4
3) the outcomes of reviews, including the perceived usefulness of
the reviews to agencies and the public and how they affected
subsequent regulatory activities; and
4) the factors that appear to help or impede agencies in
conducting or using retrospective reviews, including which
methods, if any, that agencies and we identified as most
cost-effective for conducting reviews.
We assessed the activities of nine agencies and their relevant
subagencies from 2001 through 2006, including the Departments of
Agriculture (USDA), Justice (DOJ), Labor (DOL), and
Transportation(DOT); Consumer Product Safety Commission (CPSC);
Environmental Protection Agency (EPA); Federal Communications
Commission (FCC); Federal Deposit Insurance Corporation (FDIC);
and the Small Business Administration (SBA).5 We selected these
agencies because they include Cabinet departments, independent
agencies, and independent regulatory agencies covering a wide
variety of regulatory activities in areas such as health, safety,
environmental, financial, and economic regulation.6 We were not
able to assess the activities of all regulatory agencies, due to
time and resource constraints, but, given the diversity and volume
of federal regulation conducted by the nine selected agencies, the
results of our assessment should provide a reasonable
characterization of the variety of retrospective regulatory
reviews and the issues associated with their implementation.
Further, our Federal Rules Database showed that the nine agencies
accounted for almost 60 percent of all final rules published from
2001 through 2006. The nine agencies accounted for almost 36
percent of all major rules (for example, rules with at least a
$100 million impact on the economy) published during that time
period.7
3See, for example, GAO, Regulatory Reform: Prior Reviews of Federal
Regulatory Process Initiatives Reveal Opportunities for Improvements,
[63]GAO-05-939T (Washington, D.C.: July 27, 2005), and Environmental
Protection: Assessing the Impacts of EPA's Regulations Through
Retrospective Studies, [64]GAO/RCED-99-250 (Washington, D.C.: Sept. 14,
1999).
4For purposes of this report, we define mandatory reviews as retrospective
reviews that agencies conducted in response to requirements in statutes,
executive orders, or executive branch directives. We define discretionary
reviews as reviews that agencies undertook based upon their own
initiative.
5We report findings from the following sub-agencies in the body of our
report: USDA's Agricultural Marketing Service (AMS), Animal and Plant
Health Inspection Service (APHIS), and Food Safety and Inspection Service
(FSIS); Department of Justice's Bureau of Alcohol, Tobacco, Firearms, and
Explosives (ATF) and Drug Enforcement Administration (DEA); Department of
Labor's Employee Benefits Security Administration (EBSA), Occupational
Safety and Health Administration (OSHA), Mine Safety and Health
Administration, and Employment and Training Administration (ETA); and the
Department of Transportation's Federal Aviation Administration (FAA) and
National Highway Traffic Safety Administration (NHTSA). Additional
information on these and other subagencies included in our review are
reported in appendices II-XI.
6The term "independent regulatory agencies" refers to the boards and
commissions identified as such in the Paperwork Reduction Act (44 U.S.C. S
3502(5)), including CPSC, FCC, and FDIC. "Independent agencies" refers to
agencies that answer directly to the President but are not part of Cabinet
departments. Some regulatory statutory requirements apply to Cabinet
departments and independent agencies, while others apply to those agencies
as well as the independent regulatory agencies. Unless otherwise
indicated, executive orders in this report apply to agencies other than
those considered to be independent regulatory agencies, although the
independent regulatory agencies may be asked by the Office of Management
and Budget (OMB) to voluntarily comply.
7The Congressional Review Act (CRA) (5 U.S.C. S 801) requires agencies to
file final rules with both Congress and GAO before the rules can become
effective. To compile information on all the rules submitted to us under
CRA, GAO established a database and created a standardized submission form
to allow more consistent information collection. The Federal Rules
Database is publicly available at [65]www.gao.gov under Legal Products.
To address our four objectives, we reviewed documentation from the
selected agencies and interviewed agency officials. We
administered and collected responses to a structured data
collection instrument that solicited information on agencies'
retrospective review activities and lessons learned. We
supplemented this data collection by obtaining information from
the Federal Register, Unified Agenda, and published dockets and
reports listed on agency Web sites, and by conducting a more
detailed assessment of a sample of studies completed between 2001
and 2006. We also solicited perspectives on the usefulness of
agency reviews and factors that help or impede the conduct of
reviews from regulatory oversight entities, such as the Office of
Information and Regulatory Affairs (OIRA) within the Office of
Management and Budget (OMB), the Office of Advocacy within SBA,
and knowledgeable nonfederal parties from a variety of sectors
(academia, business, public advocacy, and state government). We
reviewed agency policies, executive orders, and statutory
requirements to identify what policies and procedures agencies
have in place to guide planning, conducting, and reporting on
reviews. Further, to identify the strengths and limitations of the
processes, we assessed agencies' use of three systematic review
practices that are important to the effectiveness and transparency
of agency reviews, including the (1) use of a standards-based
approach, (2) incorporation of public involvement, and (3)
documentation of review processes and results.8 In our more
detailed assessment of a limited sample of retrospective reviews
completed between 2001 and 2006, we also assessed the agencies'
application of research and economic standards and practices. The
sample that we assessed was too small to be generalizable to all
agency retrospective reviews, but this assessment illustrated some
of the strengths and limitations that exist in agency reviews. We
conducted our work in accordance with generally accepted
government auditing standards from May 2006 through April 2007.
(See app. I for a more detailed description of our objectives,
scope, and methodology.)
Results in Brief
Since 2001, all of the selected agencies conducted multiple
retrospective reviews of existing regulations. The nine agencies
reported completing over 1,300 reviews from 2001 through 2006.
However, it is not possible to compile a complete tally of all
reviews that the agencies completed, primarily because agencies
reported that they did not always document reviews that may have
followed more informal review processes. The mix of reviews
conducted--in terms of impetus (mandatory or discretionary) and
purpose--varied among agencies. The impetus for initiating reviews
sometimes reflected various governmentwide or
agency/program-specific mandatory requirements. More often it
reflected how an agency exercises its own discretionary
authorities, such as responding to petitions or concerns raised by
regulated entities or to changes over time in an industry sector
or technology. Agency officials said that the primary purpose of
most reviews was to examine the effectiveness of the
implementation of regulations, but they also conducted reviews to
identify opportunities to reduce regulatory burdens and to
validate the original estimates of benefits and costs associated
with regulations.
8In prior work, we identified overall strengths or benefits associated
with regulatory process initiatives, including: (1) increasing
expectations regarding the analytical support for proposed rules, (2)
encouraging and facilitating greater public participation in rulemaking,
and (3) improving the transparency of the rulemaking process. Because
these strengths or benefits are also relevant and useful for assessing
agency retrospective review initiatives, we considered them in our
selection of evaluation criteria. Other practices that could improve the
effectiveness and transparency of reviews may exist and could be
considered when developing retrospective review processes. However, we
believe that the three practices that we assessed are among the most
important.
The processes and standards guiding retrospective regulatory
reviews, and the strengths and limitations of these processes,
varied widely across their three major phases, including the
selection of regulations to review, conduct of the review, and
reporting review results. We identified three important practices
that can have an impact on the effectiveness and transparency of
each phase of the review process and assessed the extent to which
they existed within agencies' processes and standards, including:
(1) use of a standards-based approach, (2) incorporation of public
involvement, and (3) documentation of review processes and
results. We found that, while some agencies have not developed
formal processes or standards that include these practices, others
have developed detailed, systematic processes. Further, whether
agencies used these practices often depended on whether they
conducted discretionary or mandatory reviews. Even for reviews
that had standards, agencies did not always apply them to their
analysis. For example, in a Section 610 review, an agency relied
only on public comments and did not assess the other four factors
identified in the mandatory review requirements.9 The extent to
which agencies involved the public varied across review phases,
with relatively more public involvement in the selection process
for discretionary reviews. Similarly, the level of documentation
of agency reviews varied depending on the impetus of the review
and the phase of the review process. For example, agencies
appeared to document the selection, conduct, and results of
reviews that they initiated in response to mandatory requirements
more often than they did for reviews conducted at their own
discretion.
9Section 610 requires agencies to consider: (1) the continued need for the
rule; (2) the nature of complaints or comments received concerning the
rule from the public; (3) the complexity of the rule; (4) the extent to
which the rule overlaps, duplicates, or conflicts with other federal
rules, and, to the extent feasible, with state and local government rules;
and (5) the length of time since the rule has been evaluated or the degree
to which technology, economic conditions, or other factors have changed in
the area affected by the rule.
Agencies reported that their reviews of existing regulations
resulted in various outcomes, including changes to regulations,
changes to guidance and related documents, decisions to conduct
additional studies, and confirmation that existing rules achieved
the intended results. Agency officials and nonfederal parties who
we interviewed reported that each of these outcomes could be
useful to the agency and the public. Agency officials reported
that some types of reviews more often resulted in subsequent
action, such as prompting the agencies to complete additional
studies or to initiate rulemaking to amend the existing rule. In
particular, they reported that discretionary reviews more often
generated additional action than mandatory reviews. For the
mandatory reviews completed within our time frame, the most common
result was a decision by the agency that no changes were needed to
the regulation.10 Nonfederal parties who we interviewed generally
considered reviews that addressed multiple purposes (such as
validation of prior estimates of benefits and costs, burden
reduction, and efficiency and effectiveness) more useful than
reviews that focused on a single purpose. One of the major
findings in our review was the difference in the perceived
usefulness of mandatory versus discretionary regulatory reviews.
Generally, the agencies characterized the results of discretionary
reviews as more productive and more likely to generate further
action. A primary reason for this appears to be that discretionary
reviews may better be suited to address emerging issues than
mandatory reviews with a predetermined time frame. For example,
USDA's AMS reported completing 11 mandated Section 610 reviews
since 2001, which resulted in no regulatory changes. For 9 of
these reviews, the related published Section 610 reports stated
that AMS made no changes to the regulations because they were
modified "numerous times" in advance of the 10-year Section 610
review to respond to changes in economic and other conditions
affecting the industry.
10Outside of DOT, we identified 88 mandatory reviews completed by our
selected agencies. DOT has an agency policy that requires its agencies to
conduct reviews of all its regulations in the Code of Federal Regulations
(CFR) to ensure the department's compliance with Section 610 and other
mandatory requirements. DOT completed 406 reviews under this policy
between 2001 and 2006.
Agencies and others reported multiple factors that impeded the
conduct and usefulness of retrospective reviews. Agencies reported
that the most critical barrier to their ability to conduct reviews
was the difficulty in devoting the time and staff resources
required for reviews while also carrying out other mission
activities. Another barrier included limits on their ability to
obtain the information and data needed to conduct reviews.
Agencies and others also identified factors that impeded the
usefulness of retrospective reviews. Among these impediments were
overlapping and duplicative review schedules and evaluation
factors. While the predetermined review schedules prompt agencies
to periodically reexamine certain regulations, their timing may
either be too short to produce meaningful analysis or too long to
account for ongoing changes that agencies make in their
discretionary reviews. For example, both EPA and FCC officials
reported that their annual and/or biannual review requirements do
not allow enough time to most effectively complete reviews and/or
observe new changes before starting a subsequent review. Further,
our examination of the timing and evaluative factors in mandatory
review requirements revealed that there is considerable overlap,
which agencies reported creates challenges to efficiently
allocating limited resources. Agencies and nonfederal parties
identified other factors that impeded the usefulness of
retrospective reviews, including difficulties in limiting reviews
to a manageable scope, and constraints in agencies' abilities to
modify some regulations without additional legislative action.
Further, they identified the lack of public participation as a
barrier to the usefulness of reviews, but differed in their
explanations for the lack of public participation. The nonfederal
parties also identified the lack of transparency in agency review
and reporting processes as a barrier to the usefulness of reviews
to the public; they were rarely aware of the retrospective review
activities reported to us by the agencies. This lack of awareness
may be, in part, because of limitations in agencies' documentation
and reporting of discretionary reviews.
Agency officials and nonfederal parties suggested a number of
practices to help the conduct and usefulness of regulatory
reviews, such as pre-planning reviews to identify the data and
analysis needed to conduct effective reviews, developing a
prioritization process to address time and resource barriers,
ensuring an appropriate level of independence in the conduct of
reviews to enhance credibility and effectiveness, obtaining
high-level management support to sustain commitment to a review
program and follow up on the review results, grouping related
regulations together when conducting reviews, making greater use
of informal networks to promote public participation, and
targeting the level of detail and type of product used to report
results to meet the needs of different audiences. Nonfederal
parties also suggested that it would be more useful if agencies
selected a few (two to five) high-priority regulations to
substantively review each year rather than conducting a cursory
review of many regulations. We found that only a few agencies
tracked the costs associated with conducting their reviews, so we
were unable to identify the most cost-effective approaches.
However, agency officials told us that reviews have resulted in
cost savings to their agencies and to regulated parties. For
example, DOL's MSHA reported that it has a policy to review and
modify regulations that regulated parties repeatedly petition for
waivers. As a result, MSHA officials believe that they save the
time and resources that would otherwise be spent on repetitively
reviewing and responding to similar petitions.
We are making recommendations to executive agencies to improve the
effectiveness and transparency of reviews through incorporating,
where appropriate, various elements into the policies and
procedures that govern their retrospective review activities, such
as establishing plans for measuring the performance of
regulations, a prioritization mechanism for review activities
based upon defined evaluation criteria, and minimum standards for
documenting and reporting review results, among other things. We
also recommend that the Administrator of OIRA and the Chief
Counsel for Advocacy work with regulatory agencies to identify
opportunities for Congress to revise the timing and scope of
existing requirements and/or consolidate existing requirements. In
addition, we suggest that Congress authorize a pilot program with
selected agencies to test the effectiveness of allowing agencies
to satisfy various retrospective review requirements with similar
objectives and evaluation factors that can be consolidated into
one review that is reported to all of the appropriate relevant
parties and oversight bodies. In formal comments on the draft
report, the SBA Office of Advocacy concurred with the
recommendations and, as an attachment, provided a copy of draft
guidance that they developed in response to our recommendations.
OMB told us that they reviewed our draft report and had no
comments. All other agencies provided technical and editorial
comments, which we incorporated as appropriate. In its technical
comments, one agency suggested that one recommendation to identify
opportunities to consolidate existing retrospective reviews for
statutory requirements could be broadened to include executive
requirements. However, we limit our recommendation to statutory
retrospective review requirements because they tend to be
recurring and/or on a predetermined review schedule.
Background
The performance and accountability of government agencies and
programs have attracted substantial attention by Congress, the
executive branch, and others, including GAO. For example, the
Government Performance and Results Act of 1993 (GPRA) established
a statutory framework designed to provide congressional and
executive decision makers with objective information on the
relative effectiveness and efficiency of federal programs and
spending.11 A central element of the current administration's
Presidential Management Agenda is the Program Assessment Rating
Tool (PART), designed by OMB to provide a consistent approach to
assessing federal programs in the executive budget formation
process.12 Over the past 2 years, we have emphasized that the
long-term fiscal imbalance facing the United States and other
significant trends and challenges establish the need to reexamine
the base of the federal government and its existing programs,
policies, functions, and activities.13 We noted that a
top-to-bottom review of federal programs and policies is needed to
determine if they are meeting their objectives.14 To support this
reexamination, the policy process must have the capacity to
provide policymakers not only with information to analyze the
performance and results achieved by specific agencies and
programs, but that of broad portfolios of programs and tools
(including regulation) contributing to specific policy goals.
While initiatives such as GPRA and PART can evaluate regulatory
performance at the agency or program level, Congress and
presidents also have instituted requirements that focus on a more
basic element, the agencies' existing regulations.15 For example,
through Section 610, Congress requires agencies to review all
regulations that have or will have a "significant economic impact
upon a substantial number of small entities" (generally referred
to as SEISNOSE) within 10 years of their adoption as final rules.
The purpose of these reviews is to determine whether such rules
should be continued without change, or should be amended or
rescinded, consistent with the stated objectives of applicable
statutes, to minimize impacts on small entities. As discussed
later in this report, Congress also established other requirements
for agencies to review the effects of regulations issued under
specific statutes, such as the Clean Air Act.16 Every president
since President Carter has directed agencies to evaluate or
reconsider existing regulations. For example, President Carter's
Executive Order 12044 required agencies to periodically review
existing rules; one charge of President Reagan's task force on
regulatory relief was to recommend changes to existing
regulations; President George H.W. Bush instructed agencies to
identify existing regulations to eliminate unnecessary regulatory
burden; and President Clinton, under section 5 of Executive Order
12866, required agencies to develop a program to "periodically
review" existing significant regulations.17 In 2001, 2002, and
2004, the administration of President George W. Bush asked the
public to suggest reforms of existing regulations.
11GPRA (Pub. L. No. 103-62, 107 Stat. 285 (Aug. 3, 1993)) required federal
agencies to develop strategic plans with long-term, outcome-oriented goals
and objectives, annual goals linked to achieving the long-term goals, and
annual reports on the results achieved. See GAO, Results-Oriented
Government: GPRA Has Established a Solid Foundation for Achieving Greater
Results, [66]GAO-04-38 (Washington, D.C.: Mar. 10, 2004).
12PART is a standard series of questions meant to serve as a diagnostic
tool, drawing on available program performance and evaluation information
to form conclusions about program benefits and recommend adjustments that
may improve results. See GAO, Program Evaluation: OMB's PART Reviews
Increased Agencies' Attention to Improving Evidence of Program Results,
[67]GAO-06-67 (Washington, D.C.: Oct. 28, 2005).
13See, for example, GAO, United States Government Accountability Office:
Supporting the Congress through Oversight, Insight, and Foresight,
[68]GAO-07-644T (Washington, D.C.: Mar. 21, 2007), and 21st Century
Challenges: Reexamining the Base of the Federal Government,
[69]GAO-05-325SP (Washington, D.C.: February 2005).
14See GAO, Forces That Shape America's Future: Themes from GAO's Strategic
Plan 2007-2012, [70]GAO-07-467SP (Washington, D.C.: March 2007).
The Office of Advocacy within SBA and OIRA within OMB have issued
guidance to federal agencies on the implementation of,
respectively, the RFA and Executive Order 12866.18 The available
guidance documents, including OMB Circular A-4 on regulatory
analysis, focus primarily on the procedural and analytical steps
required for reviewing draft regulations, but they are also
generally applicable whenever agencies analyze the benefits and
costs of regulations, including those of existing regulations.
However, the documents provide limited guidance focused
specifically on retrospective reviews. In a short discussion on
periodic reviews of existing rules pursuant to Section 610, the
Office of Advocacy's RFA guidance briefly touches on planning,
conducting, and reporting the results of reviews, but the OMB/OIRA
guidance does not specifically address the executive order's
periodic review requirement.19
15The underlying statutes also play an important role and contribute to
differences in agencies' regulatory activities. See, for example, GAO,
Chemical Risk Assessment: Selected Federal Agencies' Procedures,
Assumptions, and Policies, [71]GAO-01-810 (Washington, D.C.: Aug. 6,
2001).
16See, for example, 42 U.S.C. SS 7411(b)(1)(B), 7412(d)(6).
17The Executive Order 12866 of September 30, 1993, as amended by Executive
Order 13258 of February 26, 2002, and Executive Order 13422 of January 18,
2007, is still in effect.
18OIRA has primary responsibility for implementing Executive Order 12866,
reviewing and coordinating regulatory activities of Cabinet departments
and independent agencies, and issuing guidance on the regulatory review
process. SBA's Office of Advocacy monitors and provides guidance regarding
the compliance of all agencies, including independent regulatory agencies,
with the RFA.
19See U.S. Small Business Administration, Office of Advocacy, A Guide for
Government Agencies: How to Comply with the Regulatory Flexibility Act
(Washington, D.C.: May 2003).
In our prior work on this subject, we found that agencies
infrequently performed certain types of reviews and identified
potential challenges and benefits of conducting retrospective
reviews.20 In 1999, we reported that assessments of the costs and
benefits of EPA's regulations after they had been issued had
rarely been done.21 In a series of reports on agencies' compliance
with Section 610 requirements, we again noted that reviews were
not being conducted.22 We identified a number of challenges to
conducting retrospective reviews. In general, these included the
difficulties that regulatory agencies face in demonstrating the
results of their work, such as identifying and collecting the data
needed to demonstrate results, the diverse and complex factors
that affect agencies' results (for example, the need to achieve
results through the actions of third parties), and the long time
period required to see results in some areas of federal
regulation.23 We also identified concerns about the balance of
regulatory analyses, because it may be more difficult to estimate
the benefits of regulations than it is to estimate the costs. Our
report on EPA's retrospective studies noted that such studies were
viewed as hard to do because of the difficulty in obtaining valid
cost data from regulated entities and quantifying actual benefits,
among other reasons. Our work on agencies' implementation of
Section 610 requirements revealed that there was confusion among
the agencies regarding the meaning of key terms such as SEISNOSE,
what RFA considers to be a "rule" that must be reviewed, and
whether amending a rule within the 10-year period provided in
Section 610 would "restart the clock," among other things.
20Other studies about retrospective reviews of federal regulations have
also recognized the potential usefulness of such evaluations and
identified problems associated with effectively reviewing existing
regulations. See, for example: Neil R. Eisner and Judith S. Kaleta,
Federal Agency Reviews of Existing Regulations, 48 Admin. L. Rev. (1996)
pp. 139-174; Office of Management and Budget, Validating Regulatory
Analysis: 2005 Report to Congress on the Costs and Benefits of Federal
Regulations and Unfunded Mandates on State, Local, and Tribal Entities
(Washington, D.C.: 2005); and Michael R. See, Willful Blindness: Federal
Agencies' Failure to Comply with the Regulatory Flexibility Act's Periodic
Review Requirement--and Current Proposals to Invigorative the Act, 33
Fordham Urb. L.J. (2006) pp. 1199-1255.
21See GAO, Environmental Protection: Assessing the Impacts of EPA's
Regulations Through Retrospective Studies, [72]GAO/RCED-99-250
(Washington, D.C.: Sept. 14, 1999).
22See, for example, GAO, Regulatory Flexibility Act: Congress Should
Revisit and Clarify Elements of the Act to Improve Its Effectiveness,
[73]GAO-06-998T (Washington, D.C.: July 20, 2006).
23GAO, Managing for Results: Regulatory Agencies Identified Significant
Barriers to Focusing on Results, [74]GAO/GGD-97-83 (Washington, D.C.: June
24, 1997).
However, our prior work also pointed out that retrospective
evaluation could help inform Congress and other policymakers about
ways to improve the design of regulations and regulatory programs,
as well as play a part in the overall reexamination of the base of
the federal government.24 For example, we reported that
retrospective studies provided insights on a market-based
regulatory approach to reduce emissions that cause acid rain and
that the studies found that the actual costs of reducing emissions
were lower than initially estimated. Experts and stakeholders whom
we consulted during work on federal mandates (including
regulations) and economic and regulatory analyses told us that
they believe more retrospective analysis is needed and, further,
that there are ways to improve the quality and credibility of the
analyses that are done.25 One particular reason cited for the
usefulness of retrospective reviews was that regulations can
change behavior of regulated entities, and the public in general,
in ways that cannot be predicted prior to implementation.
24See [75]GAO-05-939T .
25See GAO, Economic Performance: Highlights of a Workshop on Economic
Performance Measures, [76]GAO-05-796SP (Washington, D.C.: July 18, 2005);
Unfunded Mandates: Views Vary About Reform Act's Strengths, Weaknesses,
and Options for Improvement, [77]GAO-05-454 (Washington, D.C.: Mar. 31,
2005); [78]GAO-05-939T ; and [79]GAO/RCED-99-250 .
All Selected Agencies Reviewed Existing Regulations, but the
Purposes of the Reviews Varied
Since 2001, the nine selected agencies conducted multiple
retrospective reviews of their existing regulations to respond to
mandatory and discretionary authorities. Between 2001 and 2006,
the nine agencies reported completing over 1,300 mandatory or
discretionary reviews, but many could not tally the total number
of reviews that they have conducted. The reviews addressed
multiple purposes, such as examining the efficiency and
effectiveness of regulations and identifying opportunities to
reduce regulatory burden. The mix of reviews conducted--in terms
of the impetus to start a review and the purpose of the
review--varied not only across but also within the agencies that
we examined.
Agencies Conducted Most Reviews on Their Own Discretion Rather
than in Response to Mandatory Requirements, but the Total Number
Is Unknown
Agencies conducted reviews in response to various mandatory
requirements, but most agencies indicated that they conducted the
majority of reviews based on their own discretion. Agencies
reported conducting reviews, at their own discretion, in response
to their agencies' own formal policies and procedures to conduct
reviews or to respond to accidents or similar events, changes in
technology and market conditions, advances in science, informal
agency feedback, and petitions, among other things. Among the main
mandatory sources of reviews were governmentwide statutory
requirements (such as Section 610 of the RFA or the Paperwork
Reduction Act (PRA)), agency- or program-specific statutory
requirements (such as Section 402 of the Telecommunications Act of
1996 that requires FCC to review the regulations promulgated under
the act every 2 years),26 Executive Order 12866 on Regulatory
Planning and Review (which requires agencies to periodically
conduct reviews of their significant regulations),27 and other
executive branch directives (such as the memorandum on plain
language). In addition, agencies conducted reviews in response to
OMB initiatives to solicit nominations for regulatory
reexamination, which were not statutorily mandated reviews or
required by a specific executive order, but were a part of
executive branch regulatory reform efforts. The frequency of
agency reviews varied based on review requirements. In some cases,
agencies were required to conduct reviews every 2 years to 10
years. Available information on completed reviews indicated that
the numbers of reviews completed by individual agencies in any
given year varied from a few to more than a hundred.
26Section 402 amended the Telecommunications Act to add a new Section 11.
These reviews are referred to as Section 11 reviews. See 47 U.S.C.S161.
27A significant regulatory action under the executive order is defined as
any regulatory action that, for example, may have an annual effect on the
economy of $100 million or more, or create a serious inconsistency or
otherwise interfere with an action taken or planned by another agency,
among other things.
Agencies' officials reported they conducted discretionary reviews
more often than mandated studies. These discretionary reviews were
often prompted by drivers such as informal suggestions or formal
petitions from regulated entities seeking regulatory changes,
suggestions from the agency personnel who implement and enforce
the regulations, departmentwide initiatives to review regulations,
or changes in particular technologies, industries, or markets.
Although these discretionary reviews were often undocumented, our
review of publicly available results for retrospective reviews
confirmed that, in some instances, agencies like those within DOL,
DOT, and DOJ cited discretionary drivers as the motivation for
their reviews.
Among the various reasons for agency-initiated reviews, petitions
were a major review driver for almost all of the agencies. Agency
officials cited three types of petition activities that largely
influenced them to conduct regulatory reviews. These petition
activities included: (1) petitions for rulemaking where the
regulated entities or public requested a modified rule that
includes new or updated information, (2) petitions for
reconsideration where regulated entities or the public requested
that the agency revisit an aspect of the rule, and (3) petitions
for waivers where the regulated entities or public requested
waivers from regulatory requirements. Some agencies, such as DOT
and MSHA, have policies to begin a more formal review of the
entire regulation when there are a substantial number of
petitions.
Agencies also reported conducting reviews in response to various
mandatory requirements. However, whether they conducted them more
often in response to governmentwide requirements or requirements
specific to the policy area or sector that they regulate varied
among and within agencies. For example, DOT, USDA's APHIS, and SBA
conducted many mandatory reviews in response to Section 610
requirements, while others, such as EPA and FCC, conducted most
mandatory reviews in response to statutes that applied
specifically to areas that they regulate. Specifically, all of the
mandatory reviews completed by APHIS and SBA since 2001 were
conducted in response to Section 610 requirements. Similarly, DOT
initiated a systematic 10-year plan for reviewing all of its
sections of the CFR in order to satisfy the provisions of Section
610, along with other mandatory review requirements.28 DOT
reported completing over 400 reviews between 2001 and 2006 under
this 10-year plan. However, even within DOT, variation existed
with regard to which review requirements more often prompted
reviews. For example, unlike some other DOT agencies, FAA
conducted the majority of its mandatory reviews in response to
industry-specific review requirements rather than governmentwide
retrospective review mandates.
While EPA, FCC, and FDIC also conduct some reviews in response to
governmentwide requirements, such as Section 610, they most often
conducted mandatory reviews to comply with statutes that apply
specifically to areas that they regulate. EPA officials provided a
list of seven statutes that require the agency to conduct
mandatory retrospective reviews, including requirements in the
Safe Drinking Water Act, Clean Air Act, Clean Water Act, and
Federal Food, Drug and Cosmetic Act, among others. Similarly, FCC
conducts many of its mandatory retrospective reviews to comply
with the biennial and quadrennial regulatory review requirements
under the Communications Act, as amended. One agency in our
review, FDIC, conducted most of its mandatory reviews in response
to the financial-sector-specific Economic Growth and Regulatory
Paperwork Reduction Act of 1996 (EGRPRA), which requires federal
financial regulatory agencies to identify outdated, unnecessary,
or unduly burdensome statutory or regulatory requirements every 10
years.29 Finally, agencies also conducted single comprehensive
reviews of a regulation as a method to satisfy multiple review
requirements. For example, DOL's EBSA and OSHA, DOT, and FDIC
conducted reviews that incorporated Section 610 and other review
requirements into broader reviews that the agency initiated as
part either of their regular review program or in response to
industry feedback and petitions, among other things. (Table 1
illustrates the range of mandatory and discretionary reviews
conducted by selected agencies included in our scope.)
28Each year of DOT's plan coincides with the fall-to-fall schedule for
publication of the department's regulatory agenda. Year 1 of this process
began in the fall of 1998.
2912 U.S.C. S 3311.
Table 1: Impetus for Mandatory and Discretionary Reviews Conducted Between
2001 and 2006
Impetus of review
Mandatory reviews Discretionary reviews
Petitions Sector Internal
or other changes drivers
forms of (e.g., new (e.g.,
industry science, improving
and technology, enforcement
Sector- Agency consumer or market or
Agency Governmentwide Agency-specific specific policy feedback trends) compliance)
USDA
DOJ
DOL
DOT
CPSC
EPA
FCC
FDIC
SBA
Source: GAO analysis of agency data and regulatory statutes.
Note: We were not able to verify the conduct of some discretionary reviews
reported by agencies because they were not documented.
The frequency with which agencies were required to conduct certain reviews
varied depending on the statutory requirement. For example, under some
statutory requirements, agencies must review certain regulations every 2
or 3 years. Other requirements cover a longer period, such as Section
610's requirement to revisit certain rules 10 years after their issuance,
or specify no particular time. In addition, agency policies on the
frequency with which to conduct discretionary reviews varied. For example,
USDA has a departmentwide requirement generally to review economically
significant and major regulations every 5 years, while FAA conducts its
reviews on a 3-year cycle. Some agencies, such as DOT, had a
departmentwide requirement to review all regulations in its CFR within 10
years of the creation of its Unified Agenda Regulatory Plan, but provided
discretion to its agencies on when to conduct reviews during that period.
Despite a perception expressed by some federal and nonfederal parties that
agencies are not actively engaged in reviewing their existing regulations,
we found that agencies reported results for over 1,300 reviews completed
between 2001 through 2006. However, even this number may understate the
total because it does not account for all of the undocumented
discretionary reviews conducted by agencies. In addition, the available
information reported by the agencies (and others, such as OMB) may include
some duplication or fail to capture additional follow-up reviews by the
agencies. It is also important to note that the units of analysis that
agencies used in their reviews, and the scope of individual reviews,
varied widely. Therefore, the level of agency review activity cannot be
compared by only assessing the number of reviews completed. For example, a
review might be as narrowly focused as the review that DOT's NHTSA
completed in 2005 on 49 CFR part 571.111 (regarding rearview mirrors) or
as broad as a FDIC review that included analyses of 131 regulations within
a single review. DOT also pointed out that because rules vary widely in
complexity, even a narrowly focused review can be a major undertaking. For
example, NHTSA may review a one-sentence rule that says, "all motor
vehicles sold in the U.S. must be equipped with airbags." In another
review, they may look at 131 regs that impose very minor requirements. It
may well be a far more time and resource intensive effort for NHTSA to
review the effect of the one-sentence airbag requirement. Further, because
some agencies produce many more regulations than others do, the number of
reviews that agencies reported conducting also should be considered within
the context of their volume of regulations and rulemaking activity.30
Table 2 lists the number of reviews that agencies reported completing
between 2001 and 2006.
Table 2: Retrospective Reviews for which Results Were Reported 2001-2006,
for Selected Agencies
Agency Numbers and types of completed reviews that were reported
USDA At least 531 reviews:
o APHIS completed 9 Section 610 reviews and numerous other
reviews resulting in 139 rule modifications
o AMS completed 11 Section 610 and 300 discretionary reviews
o FSIS completed 1 Section 610 review and 36 discretionary
reviews in response to petitions
o USDA completed 17 reviews in response to OMB regulatory reform
nominations from 2001 to 2004 31
DOJ At least 20 reviews:
o Completed 1 Section 610 review
o Completed 10 discretionary reviews and 2 other reviews for
agency-specific requirements
o Completed 7 reviews in response to OMB regulatory reform
nominations from 2001 to 2004
DOL At least 60 reviews:
o EBSA completed 7 reviews, including 4 Section 610 reviews
o OSHA completed 4 Section 610 reviews
o MSHA completed 4 discretionary reviews
o ETA completed 3 discretionary reviews
o All DOL agencies conducted reviews under departmentwide
initiatives in 2005 and 2006, including those listed for the
agencies above
o Completed 42 reviews in response to OMB regulatory reform
nominations from 2001 to 2004
DOT At least 488 reviews:
o Completed 406 reviews per the departmentwide 10-year
regulatory review plan, which addresses mandatory requirements
such as Section 610
o Completed a stand-alone regulatory review initiative in 2005
(that generated 120 public comments to which DOT responded)
o FAA conducted reviews of 3 regulations per requirements in the
Federal Aviation Authorization Act of 1996
o NHTSA conducted 17 other reviews of existing regulations
o Completed 61 reviews in response to OMB regulatory reform
nominations from 2001 to 2004
CPSC At least 4 reviews:
o Conducted as part of the agency's regulatory review program
EPA At least 156:
o Completed 14 Section 610 reviews
o Completed 20 reviews in response to agency specific mandates
o Completed 6 discretionary reviews
o Completed 116 reviews in response to OMB regulatory reform
nominations from 2001 to 2004
FCC At least 47 reviews:
o Completed 1 Section 610 review (2006)
o Completed 15 biennial reviews of all telecommunications rules
(2002, 2004, 2006)
o Completed 2 quadrennial reviews of all broadcast ownership
rules (2002, 2006)
o Completed 1 review of rules regarding the pricing of unbundled
network elements (2003)
o Completed 2 periodic reviews of digital television conversion
process
o Completed 26 reviews in response to OMB regulatory reform
nominations from 2001 to 2004
FDIC At least 4 reviews:
o Completed 2 Section 610 reviews
o Completed 1 EGRPRA review, in conjunction with the members of
the Federal Financial Institutions Examination Council (FFIEC)32
o Completed 1 discretionary review
SBA At least 32 reviews
o Completed 4 Section 610 reviews
o Completed 27 reviews in response to petitions
o Completed 1 review in response to OMB regulatory reform
nominations from 2001 to 2004
Total At least 1,300 reviews conducted in response to various
requirements and drivers
Source: GAO analysis of agency and other publicly available data sources.
aThe numbers in this table represent individual reviews conducted and not
the number of regulations reviewed because, in some cases, one review
covered multiple regulations.
bThe information presented in this table also only reflects reviews
reported by the agencies as having been completed. The agencies also
reported initiating other reviews during this time period that are not yet
complete.
30For example, during the 2001 through 2006 time period covered by our
report, USDA published 1,132 final rules, DOJ 199, DOL 151, DOT 6,415,
CPSC 12, EPA 2,948, FCC 1,044, FDIC 40, and SBA 47.
31OMB requested input on guidance and regulations, respectively. For this
review we only count agencies' reforms of their existing regulations.
Agency Officials Reported that They Most Often Conducted Reviews to Assess the
Effectiveness of Their Regulations
According to agency officials, they conducted reviews for various purposes
but most often focused on assessing the effectiveness of regulations.
Agency officials reported conducting reviews to evaluate or identify (1)
the results produced by existing regulations, including assessments to
validate the original estimates of projected benefits and costs associated
with the regulation; (2) ways to improve the efficiency or effectiveness
of regulatory compliance and enforcement; and (3) options for reducing
regulatory burdens on regulated entities.33 Overall, agency officials
reported that their reviews more often focused on improving effectiveness,
with burden reduction as a secondary consideration, even for review
requirements that are geared toward identifying opportunities for burden
reduction, such as those within Section 610. The approaches that agencies
reported taking to assess "effectiveness" varied, including measuring
whether the regulations were producing positive outcomes, facilitated
industry compliance with relevant statutes, and/or were assisting the
agency in accomplishing its goals. For example, DOL officials reported
that the agency attempts to assess "effectiveness" by measuring
improvements resulting from the regulation and by analyzing factors
required by Section 610 of RFA and Section 5 of Executive Order 12866,
such as whether there is new technology, excessive complexity, conflict
with other regulations, or whether cost-effectiveness can be improved.
However, the agency does not conduct what would be considered a
traditional benefit-cost economic analysis. Other agencies, such as EPA,
reported assessing "effectiveness" by determining whether the regulation
is achieving its intended goal as identified in related statutes. For
example, officials from EPA reported that their retrospective review of
the Clean Water Act helped them estimate the extent to which toxic
pollutants remained, thereby aiding them to assess the effectiveness of
each existing regulation in various sections of the act. Since the goal of
the Clean Water Act is zero discharge of pollutants, the review was an
indicator of the progress the agency had made toward the statutory goals.
Our limited review of agency summaries and reports on completed
retrospective reviews revealed that agencies' reviews more often attempted
to assess the effectiveness of their implementation of the regulation
rather than the effectiveness of the regulation in achieving its goal.
32 FFIEC is a formal interagency body empowered to prescribe uniform
principles, standards, and report forms for the federal examination of
financial institutions by FDIC, the Board of Governors of the Federal
Reserve System, the National Credit Union Administration, the Office of
the Comptroller of the Currency, the Office of Thrift Supervision, and
State Liaison Committee to make recommendations to promote uniformity in
the supervision of financial institutions
33 Although agencies reported that one of the purposes of their reviews
was to validate the original cost and benefits, during this time we only
identified two reviews that focused on this purpose. Therefore, this does
not appear to be a very common type of retrospective review.
Agencies Varied in the Extent to Which They Used Formal Processes and Standards
for Selecting, Conducting, and Reporting on Retrospective Reviews
The use of systematic evaluation practices and the development of formal
retrospective regulatory review processes varied among and even within the
agencies.34 To assess the strengths and limitations of various agency
review processes, we examined the three phases of the process: the
selection of regulations to review, conduct of reviews, and reporting of
review results. We identified three practices that are important for
credibility in all phases of the review, including the extent to which
agencies (1) employed a standards-based approach, (2) involved the public,
and (3) documented the process and results of each phase of the review.
The use of these evaluation practices in agency review processes, and the
development of formal policies and procedures to guide their review
processes, varied among the agencies. Furthermore, whether agencies used
these practices often varied according to whether they conducted
discretionary or mandatory reviews.35 Fewer agencies used standards-based
approaches or documented the selection, conduct, or reporting of reviews
when they were discretionary. While more agencies incorporated public
involvement in the selection of regulations for review in discretionary
reviews, fewer included public involvement in the conduct of those
reviews. Generally, agencies did not consistently incorporate the three
practices we identified into their discretionary reviews as often as they
did for their mandatory reviews. However, it is important to note that
some agencies have recently developed their review programs and others are
attempting to find ways to further develop and improve their retrospective
review processes (i.e., establishing units that focus on retrospective
reviews and seeking assistance with establishing prioritization systems).
For example, CPSC and EBSA recently established their review programs, and
ETA recently established a centralized unit to develop retrospective
review processes for the agency. Furthermore, although the process has
been delayed because of other regulatory priorities, MSHA recently sought
contractor assistance with developing a more standard selection process
for its reviews. (Additional details on each agency's review process can
be seen in apps. II through XI).
34Appendix IV provides an illustration of the variation in review
processes even within agencies, as demonstrated by agencies within DOL.
35To illustrate how an agency can apply these characteristics in a
detailed formal program that defines key terms and identifies important
evaluation factors that agencies can consider in each phase, we provide a
detailed example of EBSA's regulatory review program in app. XI. EBSA's
program was the most comprehensive documented review process that we
examined within the scope of our review.
Agencies Employed Standards-Based Approaches More Often in Mandatory Reviews
All of the agencies in our review reported that they have practices in
place to help them select which of their existing regulations to review.
Some of these agencies have established or are establishing standard
policies and procedures, and guidance for this selection. While almost all
of the agencies reported having standards to select regulations for their
mandated reviews because the mandates identified which regulations
agencies must review or prescribed standards for selecting regulations to
review, fewer agencies had yet developed formal standards for selecting
regulations to review under their own discretion. Agencies that had
established such processes reported that they were useful in determining
how to prioritize agency review activities. For example, DOL's EBSA and
CPSC established detailed standards for the selection of their
discretionary reviews, which they used to prioritize their retrospective
review activities and the corresponding use of agency resources. The
officials reported that their standards-based selection processes allowed
them to identify which regulations were most in need of review and to plan
for conducting those reviews. Furthermore, officials from both agencies
reported that their prioritization processes allowed them to focus on more
useful retrospective review activities, which resulted in identifying
important regulatory changes. We observed that this standards-based
approach to selecting regulations also increased the transparency of this
phase of the review process. We were better able to determine how these
agencies selected which regulations to review. Further, as identified by
CPSC officials and others, applying a standards-based approach to
selecting regulations to review can provide a systematic method for
agencies to assess which regulations they should devote their resources
toward, as they balance retrospective review activities with other
mission-critical priorities. The consequence of not using a
standards-based approach could result in diverting attention from
regulations that, through criteria, agencies could identify as needing the
most consideration. Otherwise, agencies may instead focus their reviews on
regulations that would warrant less attention. In addition--for each phase
of the review process--using a standards-based approach can allow agencies
to justify the appropriateness of the criteria that they use (either
because they are objective, or at least mutually agreed upon), and thus
gain credibility for their review. Selecting a different criterion or set
of standards for each review could imply a subjective evaluation process
and possibly an arbitrary treatment of one regulation versus another.
Similarly, agencies varied in their use of a standards-based approach when
analyzing regulations in reviews. While most of the mandatory review
requirements identified by the selected agencies establish standard review
factors that agencies should consider when conducting their reviews--which
agencies reported following--about half of the agencies within our review
have formal policies and procedures that establish a standards-based
approach for conducting discretionary reviews. Specifically, the five
agencies that had formal procedures that established standards defined the
steps needed to conduct reviews and review factors used to assess
regulations. Other agencies had not yet established written guidance or
policies to guide their conduct of reviews or define the analytical
methods and standards they should use to assess regulations. When we
identified agencies that did specify objectives and review factors that
they used when conducting reviews, they ranged from general (such as to
identify if they were still needed or could be simplified) to specific
(such as to account for new developments in practices, processes, and
control technologies when assessing emission standards). We observed that
the more specific sets of evaluative factors that agencies considered in
different types of reviews shared several common elements, such as
prompting agencies to consider comments and complaints received by the
public and the regulation's impact on small entities.
Our assessment of a small sample of agency reviews revealed that, even
when relevant standards were available to agencies for conducting reviews,
they did not always apply them. In one case, the economic analyses
conducted in the agency review did not employ some of the relevant best
practices identified for these types of analyses in OMB's guidance. In
another case, in conducting a mandated Section 610 review, the agency
relied only on public comments to evaluate the regulation and did not
provide any additional assessment on the other four factors identified in
the mandatory review requirements.36 According to agency documentation, it
(1) provided no further assessment of the factors and (2) concluded that
the regulation did not need changes, because the agency received no public
comments. Conversely, our review of another agency's Section 610
assessment of regulations provided an example of how agencies that apply
standards can use the reviews to produce substantive results. Because the
agency relied both on public comments and its own assessment of the five
Section 610 review factors/standards, the agency identified additional
changes that would not have been identified if it had relied on only one
of these standards. When we assessed whether agencies applied other
generally accepted review standards, such as identifying how well they
implemented the regulation, whether there was a pressing need for the
regulation, or whether intended or unintended effects resulted from the
regulation, we observed that some agencies' analyses did not.
36Section 610 requires agencies to assess: (1) the continued need for the
rule; (2) the nature of complaints or comments received concerning the
rule from the public; (3) the complexity of the rule; (4) the extent to
which the rule overlaps, duplicates, or conflicts with other federal
rules, and, to the extent feasible, with state and local government rules;
and (5) the length of time since the rule has been evaluated or the degree
to which technology, economic conditions, or other factors have changed in
the area affected by the rule.
Most of the agencies within our review had established policies on
reporting the results of their mandatory retrospective reviews to senior
management officials and to the public, although in some cases, there was
no requirement to do so. For example, Section 610 requires federal
agencies to report on the initiation of a review, but does not require
agencies to report the findings or policy decisions resulting from the
review. Nevertheless, as a matter of practice, all of the agencies within
our review reported information on the results of their Section 610
reviews, though the content and level of detail varied. Conversely, about
half of the agencies in our review had not established written policies or
procedures for reporting the results of their discretionary retrospective
reviews to the public. As a result, we found inconsistencies in practices
within agencies on how and whether they reported the results of these
reviews to the public, resulting in less transparency in this process. For
example, agencies within DOT, USDA, and some within DOL indicated that, at
times, they report review results of discretionary reviews in the
preambles of proposed rule changes or through other mechanisms, but they
did not consistently do so. Agencies also reported that they often do not
report the results of discretionary reviews at all, if they did not result
in a regulatory change. This lack of transparency may be the cause for
assertions from nonfederal parties that they were unaware that agencies
conducted discretionary reviews of their existing regulations. Figure 1
illustrates the differences in agencies' use of a standards-based approach
in the three phases of the review process, for discretionary and mandatory
reviews.
Figure 1: Agencies' Use of Standards-based Approaches in the Review
Process, for Discretionary and Mandatory Reviews
aOne of the agencies within our review did not have any regulations that
were subject to mandatory review requirements.
Level of Public Participation Varied by Impetus and Phase of the Review Process
Agency practices varied for soliciting and incorporating public input
during the selection of regulations to review. For example, in 2005 DOT
formally requested nominations from the public on which regulations it
should review. Further, in the 2006 semi-annual Unified Agenda, the agency
sought public suggestions for which regulations it should review. However,
agencies in our review more often reported that they solicit public input
on which regulations to review during informal meetings with their
regulated entities for their discretionary reviews. Techniques used by
some of the agencies to obtain public input were informal networks of
regulated entities, agency-sponsored listening sessions, and participation
in relevant conferences. For example, USDA officials reported that they
regularly meet with industry committees and boards and hold industry
listening sessions and public meetings to obtain feedback on their
regulations. DOJ's DEA reported holding yearly conferences with industry
representatives to obtain their feedback on regulations. While almost all
of the agencies in our review reported soliciting public input in a
variety of ways for their discretionary reviews, SBA relied primarily on
the Federal Register's Unified Agenda to inform the public about their
reviews. For mandatory reviews, agencies appeared to do less outreach to
obtain public input on the selection of regulations to review. However, it
is important to note that such public input into the selection phase of
mandated reviews may not be as appropriate because agencies have less
discretion in choosing which regulations to review under specific
mandates.
Almost all agencies within our review reported soliciting public input
into the conduct of their mandatory reviews, either through the notices in
the Federal Register, or in more informal settings, such as roundtable
discussions with industries, or both. For these reviews, agencies appeared
to almost always place notices in the Federal Register, including the
semiannual Unified Agenda, soliciting public comments, but nonfederal
parties cited these tools as being ineffective in communicating with the
public because these sources are too complicated and difficult to
navigate.37 Our review of the Federal Register confirmed that agencies
often provided such notice and opportunity for public comment on these
regulatory reviews. In addition, some agencies, such as DOJ's ATF, USDA's
AMS, and FCC, reported on the agencies' analysis of the public comments
and their effect on the outcome of the review. However, we were not always
able to track such notices or discussions of public input into the conduct
of discretionary reviews. Officials from DOL's MSHA and ETA stated that,
if internal staff generated the review and it was technical in nature, the
agency might not include the public when conducting a review. However, we
were able to observe that some agencies, such as FCC, DOT, and EPA, did
post comments received from petitioners and solicited public comments on
these types of discretionary reviews in order to inform their analyses.
Most agencies within our review did not solicit or incorporate public
input on the reported results of their reviews. We are only aware of a few
agencies (NHTSA, FCC, and EPA) that provided opportunities for additional
public feedback on the analysis of their regulations before making final
policy decisions. Figure 2 illustrates the difference in agencies'
incorporation of public involvement in the three phases of the review
process, for discretionary and mandatory reviews.
37Some statutory mandates, such as Section 610, require agencies to
provide notice of retrospective reviews and solicit public comments on the
relevant regulations.
Figure 2: Agencies' Incorporation of Public Involvement in the Review
Process, for Discretionary and Mandatory Reviews
aOne of the agencies within our review did not have any regulations that
were subject to mandatory review requirements.
The Level of Documentation in Agencies' Reviews Varied Depending on the Impetus
and Phase of the Review, but Overall Could Be Improved
Agency documentation for selecting regulations to review varied from
detailed documentation of selection criteria considered to no
documentation of the selection process. For example, DOL's EBSA documented
its selection process, including selection criteria used, in detail in its
Regulatory Review Program. However, agencies did not always have written
procedures for how they selected regulations for discretionary reviews.
SBA officials, for example, were not able to verify the factors they
considered during the selection of some regulations that they reviewed
because employees who conducted the reviews were no longer with the agency
and they did not always document their review process. The officials
indicated that the agency considered whether the regulations that they
reviewed under Section 610 requirements were related to or complement each
other, but did not always document selection factors for discretionary
reviews. This lack of documentation was particularly important for SBA
because the agency reported having high staff turnover that affected
maintaining institutional knowledge about retrospective regulatory review
plans. For example, officials reported that within the 8(a) Business
Development program, there is a new Director almost every 4 years who sets
a new agenda for retrospective regulatory review needs. However, because
of other pressing factors, these reviews are often not conducted.
Consequently, we conclude that this lack of documentation may result in
duplicative agency efforts to identify rules for review or not including
rules that the agency previously identified as needing review.
Agency documentation of the analyses conducted in reviews ranged from no
documentation to detailed documentation of their analysis steps in agency
review reports. While some agencies reported the analysis conducted in
great detail in review reports, others summarized review analysis in a
paragraph or provided no documentation of review analysis at all. Some
agencies did not provide detailed reports because they did not conduct
detailed analyses. For example, SBA officials reported that, for Section
610 reviews, they do not conduct any additional analysis of the regulation
if the public does not comment on the regulation. Our assessment of a
sample of agency review reports revealed that, even for some reviews that
provided a summary of their analysis, we could not completely determine
what information was used and what analysis the agency conducted to form
its conclusions. Further, agencies in our reviews reported that they less
often documented the analysis of those reviews conducted on a
discretionary basis. One SBA official acknowledged that it would be
helpful if the agency better documented its reviews.
For each of the agencies we reviewed, we were able to find reports on the
results of some or all of their completed reviews. Nonetheless, the
content and detail of agency reporting varied, ranging from detailed
reporting to only one-sentence summaries of results. Some agencies told us
that they typically only document and report the results if their reviews
result in a regulatory change. Further, officials from many agencies
primarily reported conveying the results of only mandatory reviews to the
public. Agencies employed a variety of methods to report review results to
the public, but more often used the Federal Register and Unified Agenda.
Although agencies in our review often reported the results of their
mandatory reviews by posting them in the Federal Register, agencies like
OSHA, CPSC, FCC, and those within DOT also made some or all their review
reports available on their Web sites. During our joint agency exit
conference, officials indicated that agencies could do more to report
their review analysis and results to a wider population of the public by
using the latest information technology tools. Specifically, they said
that agencies could: (1) use listserves to provide reports to identified
interested parties, (2) make review analysis and results more accessible
on agency Web sites, and (3) share results in Web-based forums, among
other things.38 Nonfederal parties also reported that agencies could
improve their efforts to report review results to the public and cited
similar communication techniques. Additionally, nonfederal parties
reported that agencies could improve communication by conducting more
outreach to broad networking groups that represent various stakeholders,
such as the Chamber of Commerce, the National Council of State
Legislators, and the Environmental Council of States, and tailoring their
summary of the review results to accommodate various audiences. Figure 3
illustrates the differences in agencies' use of documentation in the three
phases of the review process, for discretionary and mandatory reviews.
Figure 3: Agencies' Documentation of the Review Process, for Discretionary
and Mandatory Reviews
aOne of the agencies within our review did not have any regulations that
were subject to mandatory review requirements.
38A listserve is a program used to manage e-mails for members of a
discussion group. For example, a listerve program can be used as an
automatic mailing list server. When e-mail is addressed to a listserve
mailing list, it is automatically broadcast to everyone on the list.
However, listserves can take multiple forms. For example, DOT pointed out
that within their Docket Management System, the listserve users sign up to
be notified when the agency places something in a docket of interest.
Reviews Resulted in a Variety of Outcomes that Were Considered Useful, but
Mandatory Reviews Most Often Resulted in No Change
Agency reviews of existing regulations resulted in various outcomes--from
amending regulations to no change at all--that agencies and knowledgeable
nonfederal parties reported were useful. Mandatory reviews most often
resulted in no changes to regulations. Conversely, agency officials
reported that their discretionary reviews more often generated additional
action. Both agency officials and nonfederal parties generally considered
reviews that addressed multiple purposes more useful than reviews that
focused on a single purpose.
Agency reviews of existing regulations resulted in various outcomes
including: changes to regulations, changes or additions to guidance and
other related documents, decisions to conduct additional studies, and
validation that existing rules were working as planned. Agencies and
nonfederal parties that we interviewed reported that each of the outcomes
could be valuable to the agency and the public. However, for the mandatory
reviews completed within our time frame, the most common result was a
decision by the agency that no changes were needed to the regulation.
There was a general consensus among officials across the agencies that the
reviews were sometimes useful, even if no subsequent actions resulted,
because they helped to confirm that existing regulations were working as
intended. Officials of some agencies further noted that, even when
mandatory reviews do not result in changes, they might have already made
modifications to the regulations. Our examinations of selected completed
reviews confirmed that this is sometimes the case.
Among the various outcomes of retrospective reviews were changes to
regulations, changes or additions to guidance and other related documents,
decisions to conduct additional studies, and validation that existing
rules were working as planned. Agencies and nonfederal parties that we
interviewed reported that each of the outcomes could be valuable to the
agency and the public. In our review of agency documentation, we confirmed
that some reviews resulted in regulatory actions that appeared useful. Our
review of agency documentation confirmed that some reviews can prompt
potentially beneficial regulatory changes. For example, OSHA's review of
its mechanical press standard revealed that the standard had not been
implemented since its promulgation in 1988 because it required a
validation that was not available to companies. Consequently, OSHA is
currently exploring ways to revise its regulation to rely upon a
technology standard that industries can utilize and that will provide for
additional improvements in safety and productivity.39 Although some
reviews appeared to result in useful changes, the most common result for
mandatory reviews was a decision by the agency that no changes were needed
to the regulation. However, there was a general consensus among officials
across the agencies that such decisions are still sometimes useful because
they helped to confirm that existing regulations were working as intended.
Officials of some agencies further noted that, even when mandatory reviews
do not result in changes, they might have already made modifications to
the regulations. Our examinations of selected completed reviews confirmed
that this is sometimes the case.
Agency officials reported that their discretionary reviews resulted in
additional action--such as prompting the agencies to complete additional
studies or to initiate rulemaking to amend the existing rule--more often
than mandatory reviews. In particular, officials from USDA's AMS and FSIS,
FCC, SBA, EPA, DOJ, and DOT reported that Section 610 reviews rarely
resulted in a change to regulations. Although AMS has initiated 19 Section
610 reviews since 2001, AMS officials reported that, because of their
ongoing engagement with the regulated community, these reviews did not
identify any issues that the agency did not previously know, and therefore
resulted in no regulatory changes. Similarly, none of the Section 610
reviews conducted by SBA and DOL's EBSA resulted in changes to
regulations, and few changes resulted from Section 610 reviews conducted
by EPA, FCC, DOJ, and DOT. The one apparent outlier in our analysis was
FDIC, which conducted many of its reviews in response to the
financial-sector-specific burden reduction requirement in EGRPRA.
According to FDIC officials and the agency's 2005 annual report, reviews
conducted in response to this mandate resulted in at least four regulatory
changes by the agency since 2001 and over 180 legislative proposals for
regulatory relief that FDIC and other members of the FFIEC presented to
Congress. The legislative proposals led to the passage of the Financial
Services Regulatory Relief Act, which reduced excessive burden in nine
areas in the financial sector. In addition, our analyses of the December
2006 Unified Agenda revealed that FDIC attributed four of its nine
proposed or initiated modifications to existing regulations to statutory
mandates.
39When a press is equipped with presence sensing device initiation (PSDI),
the press cycle will not initiate until the PSDI system senses that the
danger zone is clear. OSHA reviewed its PSDI standard for mechanical power
presses and found that companies were not using PSDI systems because the
standard requires an OSHA-approved third party to validate the systems at
installation and annually thereafter, but no party has pursued OSHA
approval since the standard was implemented in 1988. OSHA is currently
attempting to revise the regulation to rely upon a technology standard
that industries could utilize and that would provide for additional
improvements in safety and productivity.
Most agencies' officials reported that reviews they conduct at their own
discretion--in response to technology and science changes, industry
feedback, and petitions--more often resulted in changes to regulations. As
one of many examples, EBSA officials reported that because the reviews
initiated and conducted by the agency to date have been precipitated by
areas for improvement identified by the regulated community or the agency,
virtually all the reviews have resulted in changes to the reviewed rules.
They reported that, in general, these changes have tended to provide
greater flexibility (e.g., the use of new technologies to satisfy certain
disclosure and recordkeeping requirements) or the streamlining and/or
simplifying of requirements (e.g., reducing the amount of information
required to be reported). Similarly, DOT officials and other agencies'
officials reported that reviews that they conduct in response to industry
and consumer feedback and harmonization efforts also resulted in changes
to regulations more often than mandated reviews.
In addition, some agencies also reported that reviews that incorporated
review factors from both their mandatory requirements and factors
identified by the agency in response to informal feedback often resulted
in useful regulatory changes. These agencies' reviews incorporated factors
identified by the agency as well as ones that were requirements in
mandatory reviews. For example, DOL's OSHA and EBSA selected regulations
for review based upon criteria that they independently identified and
selection criteria identified by Section 610 requirements. They also
incorporated review factors listed in Section 610 requirements into a
broader set of evaluative factors considered during their discretionary
reviews, including assessing: (1) whether the regulation overlaps,
duplicates, or conflicts with other federal statutes or rule; and (2) the
nature of complaints against the regulation. As a result, they reported
that these reviews generated useful outcomes. Nonfederal parties also
indicated that reviews that focus on multiple review factors and purposes
are more useful than reviews that focus only one purpose, such as only
burden reduction or only enforcement and compliance or only one factor,
such as public comments.
Because agencies did not always document discretionary reviews that they
conducted, it is not possible to measure the actual frequency with which
they resulted in regulatory change. However, we observed that, for cases
where agencies reported modifications to regulations, these actions were
most often attributed to factors that agencies addressed at their own
discretion, such as technology changes, harmonization efforts, informal
public feedback, and petitions. For example, although EPA officials
reported that they have many mandatory regulatory review requirements, our
review of proposed or completed modifications to existing regulations
reported in the December 2006 Unified Agenda showed that 63 of the 64
modifications reported were attributed to reasons associated with
agencies' own discretion. As illustrated in figure 4, other agencies
within our review had similar results.
Figure 4: Modifications to Rules Listed in the December 2006 Unified
Agenda by Type of Review for Selected Agencies
Although agencies reported, and our analysis of the Unified Agenda
indicated, that agencies more often modify existing regulations for
reasons attributed to their own discretion, it is important to note that
mandatory reviews may serve other valuable purposes for Congress. Such
reviews may provide Congress with a means for ensuring that agencies
conduct reviews of regulations in policy areas that are affected by
rapidly changing science and technology and that agencies practice due
diligence in reviewing and addressing outdated, duplicative, or
inconsistent regulations. For example, Congress required FCC to conduct
reviews of its regulations that apply to the operation or activity of
telecommunication service providers to "determine whether any such
regulation is no longer necessary in the public interest as the result of
meaningful economic competition between providers of such service."40
Agencies' officials reported that reviews often had useful outcomes other
than changes to regulations, such as changes or additions to guidance and
other related documents, decisions to conduct additional studies, and
validation that existing rules were working as planned. For example, OSHA
officials reported that, outside of regulatory changes, their reviews have
resulted in recommended changes to guidance and outreach materials and/or
the development of new materials or validation of the effectiveness of
existing rules. Our review of OMB's regulatory reform nominations process
confirmed that at least four of OSHA's reviews conducted in response to
OMB's manufacturing reform initiative resulted in changes to or
implementation of final guidance or the development of a regulatory
report. We observed similar results from OMB's regulatory reform process
for EPA. Similarly, DOT officials reported that their reviews also often
led to changes in guidance or in further studies, and our examination of
review results reported by DOT confirmed that this was often the case.
Moreover, all of the agencies within our review reported that reviews have
resulted in validating that specific regulations produced the intended
results.
4047 U.S.C. S 161(a)(2).
Agencies and Nonfederal Parties Identified Barriers and Facilitators to the
Conduct and Usefulness of Retrospective Reviews
Agencies' officials reported that barriers to their ability to conduct and
use reviews included: (1) difficulty in devoting the time and staff
resources required for retrospective review requirements, (2) limitations
on their ability to obtain the information and data needed to conduct
reviews, and (3) constraints in their ability to modify some regulations
without additional legislative action, among other important factors. Both
agencies and nonfederal parties identified the lack of public
participation in the review process as a barrier to the usefulness of
reviews. The nonfederal parties also identified the lack of transparency
in agency review processes as a barrier to the usefulness of reviews.
Agency officials and nonfederal parties also suggested a number of
practices that could facilitate conducting and improving the usefulness of
regulatory reviews, including: (1) development of a prioritization process
to facilitate agencies' ability to address time and resource barriers and
allow them to target their efforts at reviews of regulations that are more
likely to need modifications, (2) pre-planning for regulatory reviews to
aid agencies in identifying the data and analysis methodology that they
will need to conduct effective reviews, and (3) utilizing independent
parties to conduct the reviews to enhance the review's credibility and
effectiveness, among other things. While there was general consensus among
federal and nonfederal parties on the major facilitators and barriers,
there were a few clear differences of opinions between them regarding
public participation and the extent to which reviews should be conducted
by independent parties. Because only a few agencies track the costs
associated with conducting their reviews, one cannot identify the type and
approach to retrospective review that may be most cost effective. However,
agency officials told us that the reviews have resulted in cost savings to
their agencies and to regulated parties, for example by saving both the
agency and the public the costs of repeatedly dealing with petitions for
change or waivers in response to difficulties implementing particular
regulatory provisions.
Time, Resources, and Information Were Among the Critical Barriers to Conducting
Reviews
All of the agencies in our review reported that the lack of time and
resources are the most critical barriers to their ability to conduct
reviews. Specifically, they said that it is difficult to devote the time
and staff resources required to fulfill various retrospective review
requirements while carrying out other mission-critical activities.
Agencies' officials reported that, consequently, they had to limit their
retrospective review activities during times when they were required to
respond to other legislative priorities. For example, officials from MSHA
reported that they conducted fewer reviews in 2006 because they were
heavily engaged in trying to implement the Mine Improvement and New
Emergency Response Act of 2006 (MINER Act), which Congress passed in
response to mining accidents that occurred in 2006.41 Prior to these
events, MSHA was engaged in soliciting a contractor to assist the agency
in prioritizing its retrospective review efforts. The officials reported
that, because of the need to develop regulations pursuant to the act, they
stopped the process of looking for a contractor, and conducted fewer
reviews. Officials from various agencies reported that retrospective
reviews are the first activities cut when agencies have to reprioritize
based upon budget shortfalls. A DOT official reported that, despite having
high-level management support for retrospective review activities, the
department has still experienced funding limitations that have affected
their ability to conduct retrospective review activities. Our examination
of agency documents confirmed that several agencies indicated that they
did not complete all of the reviews that they planned and scheduled for
some years within the scope of our review because sufficient resources
were not available. In one example, we found that FAA delayed conducting
any planned reviews for an extended period because, as reported in the
Unified Agenda, they did not have the resources to conduct them. Many of
the agencies in our review did not track the costs (usually identified in
terms of full-time equivalent (FTE) staff resources) associated with their
reviews; therefore, they could not quantify the costs of conducting
reviews.
Information and Data Limitations Present Challenges to the Conduct of
Retrospective Reviews
Most agencies' officials reported that they lack the information and data
needed to conduct reviews. Officials reported that a major data barrier to
conducting effective reviews is the lack of baseline data for assessing
regulations that they promulgated many years ago. Because of this lack of
data, agencies are unable to accurately measure the progress or true
effect of those regulations. Similar data collection issues were also
identified by agencies in the Eisner and Kaleta study published in 1996,
which concluded that, in order to improve reviews for the future, agencies
should collect data to establish a baseline for measuring whether a
regulation is achieving its goal, and identify sources for obtaining data
on ongoing performance.42
Agencies and nonfederal parties also considered PRA requirements to be a
potential limiting factor in agencies' ability to collect sufficient data
to assess their regulations. For example, EPA officials reported that
obtaining data was one of the biggest challenges the Office of Water faced
in conducting its reviews of the effluent guideline and pretreatment
standard under the Clean Water Act, and that as a result the Office of
Water was hindered or unable to perform some analyses. According to the
officials, while EPA has the authority to collect such data, the PRA
requirements and associated information collection review approval process
take more time to complete than the Office of Water's mandated schedule
for annual reviews of the effluent guideline and pretreatment standard
allows. While one nonfederal party did not agree that PRA restrictions
posed a significant barrier to conducting reviews, agencies and nonfederal
parties generally agreed that the act was an important consideration in
agency data collection. However, while agencies identified the potential
limitations of PRA, it is important to recognize that PRA established
standards and an approval process to ensure that agencies' information
collections minimize the federal paperwork burden on the public, among
other purposes.43
41 Pub. L. No. 109-231, 120 Stat. 493 (June 15, 2006).
42See Eisner and Kaleta at pages 9 and 14.
In general, data collection appeared to be an important factor that either
hindered or facilitated reviews. Some of the agencies in our review that
promulgate safety regulations, such as CPSC, NHTSA, and those within DOJ,
reported that having sufficient access to established sources of safety
data, such as death certificates or hospital databases on deaths and
injuries related to products, greatly facilitated their ability to conduct
retrospective reviews of their regulations. Finally, agencies also
reported facing limits on their ability to obtain data on their
regulations because of the length of time it takes to see the impact of
some regulations and the scarcity of data related to areas that they
regulate. Nonfederal parties also cited this data limitation as a
challenge to agency reviews.
43For a discussion of the purposes, standards, and approval process
established by PRA see GAO, Paperwork Reduction Act: New Approach May Be
Needed to Reduce Government Burden on Public, [80]GAO-05-424 (Washington,
D.C.: May 20, 2005).
Barriers to the Usefulness of Reviews Included Overlapping and Generic Schedules
and Review Factors, Scope, Statutory Limitations, Limited Public Participation,
and Transparency
Overlapping Schedules and Review Factors
To make efficient use of their time and resources, various agency
officials said that they consider all relevant factors, including
effectiveness and burden reduction, whenever they review an existing
regulation. Therefore, when reviews that have predetermined or generic
schedules and review factors (such as 10-year Section 610 reviews) arise,
the agency might have already reviewed and potentially modified the
regulation one or more times, based upon the same factors outlined in
Section 610. The officials reported that, although the subsequent
predetermined reviews are often duplicative and less productive, they
nevertheless expend the time and resources needed to conduct the reviews
in order to comply with statutory requirements. However, they reported
that these reviews were generally less useful than reviews that were
prompted because of informal industry and public feedback, petitions,
changes in the market or technology, and other reasons. Furthermore,
agencies expressed concerns about whether predetermined schedules may
conflict with other priorities. DOT acknowledged this issue even as it was
establishing an agency policy to require retrospective reviews. In
response to a public suggestion that DOT conduct reviews based upon a
regular predetermined schedule, the agency cautioned that arbitrary
schedules might mean delaying other, more important regulatory activities.
As examples of predetermined reviews that may be duplicative or
unproductive, officials from agencies within DOT, USDA, and DOL reported
that the regulations that most often apply to their industries may need
review sooner than the 10-year mark prescribed by Section 610. To be
responsive to the regulated community, the agencies regularly review their
regulations in response to public feedback, industry and technology
changes, and petitions, among other things, and make necessary changes
before a Section 610 review would be required. Our assessment of reviews
listed in the Unified Agenda confirmed that agencies often noted that they
had not made changes because of their Section 610 reviews, but had
previously made changes to these regulations because of factors that
previously emerged. For example, USDA's AMS reported completing 11
mandated Section 610 reviews since 2001, which resulted in no regulatory
changes. For 9 of these reviews, the related published Section 610 reports
stated that AMS made no changes to the regulations because they were
modified "numerous times" in advance of the 10-year Section 610 review to
respond to changes in economic and other emerging conditions affecting the
industry.
Similar to agency views on timing, views by an OMB official and some
nonfederal parties indicated that the period immediately after an agency
promulgates a rule may be a critical time for agencies to review certain
types of regulations, in part because once the regulated community invests
the resources to comply with the regulations and integrates them into
their operations, they are less likely to support subsequent changes to
the regulation. In addition, the immediate effects of certain types of
regulations, such as economic incentive regulations, may be more apparent
and changes, if needed, can be brought about sooner.44 Nonfederal parties
reported that this may be especially important during the time that
regulated entities are facing challenges with the implementation of a
regulation. Some of these commenters noted that such immediate reviews
might be especially appropriate for rules that have a high profile, are
controversial, or involve a higher degree of uncertainty than usual.
Two agencies within our review that had predetermined deadlines that are
set only a few years apart also reported that these schedules affected
their ability to produce more useful reviews. The officials reported that
they do not have enough time to effectively complete the reviews prior to
beginning another review. For example, EPA and FCC both stated that
agency-specific review requirements to conduct reviews of their
regulations every few years make it difficult for the agencies because
either the agencies do not have enough time to effectively gather data for
the reviews or do not have enough time to observe new effects of the
regulation between reviews. As a result, the agencies may be doing a less
comprehensive job in conducting the reviews and have more difficulty in
meeting their review deadlines.
44Economic incentive regulations are rules that encourage behavior through
price signals rather than through explicit instructions on how to meet
standards, such as pollution control levels. An example of such a
regulation would be an EPA rule that uses tradable permits and pollution
charges administered by the agency to achieve pollution control goals.
For requirements that specify a predetermined schedule for conducting
reviews, agencies also identified, as a potential barrier, the lack of
clarity on when to "start the clock" for regulations that have been
amended over time. For example, as previously mentioned, in order to
satisfy Section 610 requirements, DOT initiated an extensive process for
reviewing its sections of the CFR every year. The agency's officials
reported that they adopted this extensive approach because they were
unable to determine whether to review a regulation 10 years after its
promulgation or 10 years after its last modification. Other agencies
included in our review did not take this approach to meeting Section 610
requirements. Similarly, in our 1999 report on RFA, we reported that
agencies' varying interpretations of Section 610 requirements affected
when they conducted reviews.45
While agencies' officials reported that predetermined schedules can
sometimes be ineffective, it is important to note that such schedules can
also help ensure that reviews occur. Specifically, some parties have noted
that a benefit of prespecifying the timing of reviews is that this
provides Congress with a way to force agencies to periodically reexamine
certain regulations.
In general, as illustrated in table 3, our review of the timing of reviews
and the evaluative factors that agencies are supposed to assess in those
reviews revealed that there is considerable overlap in the various
mandatory and discretionary review requirements.
45GAO, Regulatory Flexibility Act: Agencies' Interpretations of Review
Requirements Vary, [81]GAO/GGD-99-55 (Washington, D.C.: Apr. 2, 1999).
Table 3: Examples of Overlapping Timing and Review Factors in
Retrospective Review Requirements
Impetus for Regulations covered by Evaluation factors to
review the review Frequency be considered
Governmentwide All regulations that Every 10 Identify burden
RFA, Section 610 are at least 10 years years reduction opportunities
review old and have a by assessing the:
requirements significant economic
impact on a o continued need for
substantial number of the rule;
small entities o nature of
complaints or
comments received
concerning the rule
from the public;
o complexity of the
rule;
o the extent to
which the rule
overlaps, duplicates
or conflicts with
other federal rules,
and, to the extent
feasible, with state
and local
governmental rules;a
o length of time
since the rule has
been evaluated or
the degree to which
technology, economic
conditions, or other
factors have changed
in the area affected
by the rule.
EGRPRA review for All regulations Every 10 Identify and assess
Financial and prescribed by years public comments on
Banking financial regulatory areas of regulations
Regulatory agencies within FFIEC that are:
agencies or by any such
appropriate federal o outdated,
banking agency o unnecessary,
o unduly burdensome.
EBSA Regulatory Substantively review Annually Assess rules to
Review Program any EBSA regulations determine whether:
that are selected as a
priority, based upon o there is a
16 factors, including continued need for
regulations that are the regulation;
subject to the RFA, o the regulation has
Section 610 been the subject of
requirements, and E.O. complaints or
12866 comments from the
public and the
nature of those
complaints;
o the regulation
overlaps,
duplicates, or
conflicts with other
federal statutes or
rules or with
nonpreempted state
or local statutes or
rules;
o the regulation is
overly complex and
could be simplified
without impairing
its effectiveness;
o the regulation may
be based upon
outdated or
superseded
employment,
industrial, or
economic practices
or assumptions and
whether participants
and/or beneficiaries
of employee benefit
plans may be exposed
to harm as a result;
o the regulation may
impose significant
economic costs on
regulated entities
and whether the
benefit(s) or
purpose(s) of the
regulation could be
achieved as
effectively through
an alternative
regulatory approach
that would impose
less economic burden
on regulated
industries,
FCC All rules applicable Every 2 Identify rules that
Communications to providers of years are:
Act Biennial telecommunications
Review service o no longer
necessary in the
public interest as a
result of meaningful
competition.
FCC Communication Almost all broadcast Every 4 Determine whether any
Act, Quadrennial ownership rules years rules:
Review
o are necessary in
the public interest
as the result of
competition, or
o are no longer in
the public interest.
EPA `s Drinking All drinking water Every 6 To assess:
Water Program regulations that were years
/Review of promulgated under whether regulations
National Drinking Section 1412(b)(9) should be modified
Water Regulation based upon contaminate
occurrences in finished
drinking water.
EPA Section All regulations on the Every 2 To identify:
405(d)(2)(C) Use and Disposal of years
Clean Water Act Sewage Sludge o whether the
Review regulation should be
updated to include
additional toxic
pollutants.
Source: GAO analysis of agency data and regulatory statutes.
aSimilar to this criterion, PRA requires agencies to consider whether
information that they propose to collect from public--including
information requests per regulatory requirements--overlaps, duplicates, or
conflicts with other federal requests for information. All proposed
collections from 10 or more persons, other than agencies,
instrumentalities, or employees of the United States must be approved by
OMB, and those approvals expire after 3 years, so must be reviewed if the
agency wishes to continue the collection.
Scope of Reviews
Various agencies identified scoping issues as a barrier to the usefulness
of reviews. Agencies' officials reported significant delays in completing
reviews and making timely modifications, as well as obtaining meaningful
input in reviews that involved multiple regulations as the unit of
analysis. Some agencies, such as DOL's MSHA, reported experiencing delays
up to 16 years in completing a review because they scoped their review too
broadly. Specifically, MSHA officials reported that, during a
comprehensive review of their ventilation standards, the scope of the
review increased due to input from other departmental agencies. Because of
this input and the complexity of the rule itself, it took 16 years to
complete the modifications, resulting in a major rewrite of the
ventilation standards. In our assessment of this review, the resulting
information was not as timely as it otherwise could have been, and
therefore may have been less useful.46 Similarly, officials from other
agencies reported that scoping reviews too broadly also affected their
ability to conduct expedient reviews. Agencies' officials suggested that
having a narrow and focused unit of analysis, such as a specific standard
or regulation, is a more effective approach to conducting reviews.
Specifically, officials from DOT and FDIC reported that, when they
conducted narrowly defined reviews, the public provided more meaningful
input on their regulations. Furthermore, one nonfederal party emphasized
that, when agencies choose to analyze a broad unit of analysis, such as an
act, it is difficult for the public to discern which regulations are doing
well and which are not. The positive effects of one regulation under the
legislation can overshadow the negative effects of other regulations.
Therefore, the performance assessment of the relevant regulations is less
transparent and, consequently, less useful.
46This review was conducted between 1980 and 1996--outside of the time
period of our report--so we did not include it in our summary data on the
number of reviews conducted by MSHA. However, agency officials identified
it as a relevant example of a "lesson learned" about conducting
retrospective reviews.
Statutory Provisions
Agencies' officials reported that statutory requirements are a major
barrier to modifying or eliminating regulations in response to
retrospective regulatory reviews because some regulations are aligned so
closely with specific statutory provisions. Therefore, the agencies may be
constrained in the extent to which they can modify such regulations
without legislative action. For example, officials from MSHA, FDIC, and
SBA reported that many of their regulations mirror their underlying
statutes and cannot be modified without statutory changes. During its
retrospective reviews to reduce burden, FDIC along with other banking
agencies within the FFIEC, identified 180 financial regulations that would
require legislative action to revise. Similarly, in our 1999 report on
regulatory burden, we found that agencies often had no discretion, because
of statutory provisions, when they imposed requirements that businesses
reported as most burdensome.47 One approach taken by FDIC to address this
issue was to identify regulations that required legislative action in
their review process and to coordinate with Congress to address these
potential regulatory changes. Because of this approach, Congress is
actively involved in FDIC's regulatory burden relief efforts and has
passed changes in legislation to provide various forms of burden relief to
the financial sector.
Limited Public Participation
Agencies and nonfederal parties identified the lack of public
participation in the review process as a barrier to the usefulness of
reviews. Agencies stated that despite extensive outreach efforts to
solicit public input, they receive very little participation from the
public in the review process, which hinders the quality of the reviews.
Almost all of the agencies in our review reported actively soliciting
public input into their formal and informal review processes. They
reported using public forums, and industry meetings, among other things
for soliciting input into their discretionary reviews, and primarily using
the Federal Register and Unified Agenda for soliciting public input for
their mandatory reviews. For example, USDA officials reported conducting
referenda of growers to establish or amend AMS marketing orders, and CPSC
officials reported regularly meeting with standard-setting consensus
bodies, consumer groups, and regulated entities to obtain feedback on
their regulations. Other agencies reported holding regular conferences, a
forum, or other public meetings. However, most agencies reported primarily
using the Unified Agenda and Federal Register to solicit public comments
on mandatory reviews, such as Section 610 reviews. Despite these efforts,
agency officials reported receiving very little public input on their
mandatory reviews.
47GAO, Regulatory Burden: Some Agencies' Claims Regarding Lack of
Rulemaking Discretion Have Merit, [82]GAO/GGD-99-20 (Washington, D.C.:
Jan. 8, 1999).
Nonfederal parties we interviewed were also concerned about the lack of
public participation in the retrospective review process and its impact on
the quality of agency data used in reviews. However, these nonfederal
parties questioned the adequacy and effectiveness of agencies' outreach
efforts. Specifically, 7 of the 11 nonfederal parties cautioned that the
Federal Register and Unified Agenda are not sufficiently effective tools
for informing the public about agency retrospective review activities. In
addition, most of the nonfederal parties we interviewed were unaware of
the extent to which agencies conducted reviews under their own discretion,
and most of those parties reported that they were not aware of the
outreach efforts agencies are making to obtain input for these reviews.
Limited public participation in some review activities was cited by both
agencies and nonfederal parties as a barrier to producing quality reviews,
in part because agencies need the public to provide information on the
regulations' effects. Both agency officials and nonfederal parties
identified methods for improving communication, including using agency Web
sites, e-mail listserves, or other Web-based technologies (such as Web
forums), among other things.
Shortcomings in Transparency
Nonfederal parties identified the lack of transparency in agency review
processes, results, and related follow-up activities as a barrier to the
usefulness of reviews to the public. Nonfederal parties were rarely aware
of the retrospective review activities reported to us by the agencies in
our review. Similarly, in our review of the Federal Register and Unified
Agenda, we were not always able to track retrospective review activities,
identify the outcome of the review, or link review results to subsequent
follow-up activities, including initiation of rulemaking to modify the
rule. As stated earlier, some mandatory reviews do not require public
reporting and many agencies did not consistently report the results of
their discretionary reviews, especially if the reviews resulted in no
changes to regulations. Some nonfederal parties told us that lack of
transparency was the primary reason for the lack of public participation
in agencies' review processes.
Agencies and Nonfederal Parties Identified Lessons Learned and Practices for
Improving Retrospective Reviews
Agencies and nonfederal parties identified pre-planning for regulatory
reviews as a practice that aids agencies in identifying the data and
analysis methodology that they need to conduct effective outcome-based
performance reviews. Some agencies within our review planned how they
would collect performance data on their regulations before or during the
promulgation of the relevant regulations or prior to the review. They
cited this technique as a method for reducing data collection barriers.
For example, DOT's NHTSA was an agency that OMB officials and nonfederal
parties identified as appearing to conduct effective retrospective reviews
of its regulations. NHTSA officials reported to us that, to conduct
effective reviews, they plan for how they will review their regulations
even before they issue them. Prior research on regulatory reviews also
cited the need for agencies to set a baseline for their data analysis, in
order to conduct effective reviews. In addition, we have long advocated
that agencies take an active approach to measuring the performance of
agency activities. Furthermore, we observed that pre-planning for data
collection could address some challenges that agencies reported facing
with PRA data collection requirements, such as the length of time required
to obtain approval.
Agencies reported that prioritizing which regulations to review
facilitated the conduct of and improved usefulness of their reviews.
Agencies that developed review programs with detailed processes for
prioritizing which regulations to review reported that this prioritization
facilitated their ability to address time and resource barriers to
conducting reviews and allowed them to target their efforts at more useful
reviews of regulations that were likely to need modifications. As
previously mentioned, DOL's EBSA and CPSC developed detailed
prioritization processes that allowed officials to identify which
regulations were most in need of review and to plan for conducting those
reviews. Furthermore, this process allowed CPSC to prospectively budget
for its reviews and to identify the number of substantive reviews per year
that the agency could effectively conduct, while meeting its other agency
priorities. Officials from both agencies reported that their
prioritization processes allowed them to focus on the most useful
retrospective review activities, which identified important regulatory
changes. Nonfederal parties that we interviewed also asserted that it is
not necessary or even desirable for agencies to expend their time and
resources reviewing all of their regulations. Instead, they reported that
it would be more efficient and valuable to both agencies and the public
for agencies to conduct substantive reviews of a small number of
regulations that agencies and the public identify as needing attention.
Nonfederal parties and agency officials suggested that factors that
agencies should consider when prioritizing their review activities could
include economic impact, risk, public feedback, and length of time since
the last review of the regulation, among other things.
Nonfederal regulatory parties believed that reviews would be more credible
and effective if the parties that conduct them were independent. For
example, two different parties who we interviewed said that EPA's first
report in response to Section 812 under the Clean Air Act could have been
improved by involving independent analysts. However, they recognized that
it is important to include input from those who were involved in the
day-to-day implementation of the regulation and were responsible for
producing initial benefit-cost estimates for the regulations. Almost all
of the nonfederal parties that we interviewed expressed concern that
agency officials who promulgated and implemented regulations may be the
same officials who are responsible for evaluating the performance of these
regulations. Although the nonfederal parties acknowledged that it is
important for officials with critical knowledge about the program to be
involved with providing input into the review, they were concerned that
officials placed in this position may not be as objective as others may
be. Nonfederal parties also expressed concerns about agencies' capacity to
conduct certain types of analyses for their reviews, such as benefit-cost
assessments. The nonfederal parties suggested that agencies could consider
having an independent body like another agency, Inspector General, or a
centralized office within the agency conduct the reviews. During our
review, agencies' officials reported that they sometimes contract out
their reviews if they do not have the expertise needed to conduct the
analyses. However, during a discussion of this issue at our joint agency
exit meeting, agency officials pointed out the difficulty in finding a
knowledgeable independent review body to conduct retrospective reviews,
and they noted that even contracted reviewers may be considered less
independent, because they are paid by the agency to conduct the study.
Agencies and nonfederal regulatory parties agreed that high-level
management support in the review process is important to the successful
implementation of not only individual reviews but also to sustaining the
agency's commitment to a review program and following up on review
results. As an example, officials from FDIC credited the accomplishments
of their review program largely to the support of high-level managers who
headed the FFIEC effort to reduce regulatory burden on financial
institutions. Officials reported that the leadership of the Director of
the Office of Thrift Supervision, who chaired the FFIEC effort, helped to
catapult support for reviews at all of the FFIEC agencies, including FDIC,
and helped to free up resources to conduct reviews at these agencies.
Almost all of the selected agencies reported involving some high-level
management attention in their reviews, but where and how they used this
involvement varied. For example, while almost all of the agencies reported
involving high-level management attention in decision-making processes
that resulted from reviews, CPSC and EBSA's review programs also involved
high-level managers early in their processes, in order to determine which
regulations to review. Overall, agencies and nonfederal parties indicated
that having high-level management attention is important to obtaining and
sustaining the resources needed to conduct reviews and the credibility of
agency reviews.
According to agency officials from DOT, DOL, SBA, and FDIC, they learned
that grouping related regulations together when conducting reviews is a
technique that more often generated meaningful comments and suggestions
from the public. For example, officials from FDIC stated that categorizing
regulations for review and soliciting input over an extended time period
proved to be a more effective way of receiving public input. They reported
that placing regulations into smaller groups and soliciting feedback on
these categories separately over a 3-year period helped the members of the
FFIEC to avoid overwhelming the public with the regulatory reviews, and
allowed the agencies to receive more thoughtful participation and input.
SBA officials reported reviewing related regulations together because a
change to one rule can have an impact on the related rules. Similarly, a
DOT official reported that grouping similar regulations together to
solicit public input was an effective technique for FAA because the agency
regulates a broad policy area. FAA received 1800 suggestions for
regulatory changes based upon one such review. However, the official
cautioned that while grouping regulations is an effective technique to
obtaining useful public input, defining the categories too broadly can
lead to an effort that is too intensive. In addition, the practice may be
less convenient and practical for agencies that write very specific
standards, such as NHTSA. For these agencies it may be more effective to
pick related characteristics of rules in order to group regulations to
review.
Nonfederal parties suggested that agencies need to be more aware of the
different audiences that might be interested in their reviews, and target
the level of detail and type of product used to report the results to meet
the needs of these various audiences. For example, a product that focuses
on specific details of implementing a regulation may be less useful to
those interested in the policy effects of a regulation, and vice versa.
Further, both agency officials and nonfederal parties identified methods
for improving communication, including better use of information
technology tools, such as agency Web sites, electronic docket systems,
e-mail listserves, Web-based forums, or other Web-based technologies.
Some Agencies Believe Retrospective Reviews Can Result in Cost Savings
Agencies have not estimated all of the costs and benefits associated with
conducting retrospective reviews, but they believe that retrospective
reviews have resulted in cost savings to their agencies. For example, MSHA
officials reported that their retrospective regulatory reviews related to
petitions for modification produce savings for the agency because the
reviews prompt the agency to review and modify regulations that are
heavily petitioned, which reduces costs associated with reviewing similar
petitions.48 They reported that these reviews also save the mining
industry from the costs associated with repeatedly filing petitions. In
addition to petition-related cost savings, agencies could save costs by
reviewing and eliminating regulations that are no longer useful.
Therefore, agencies could reduce costs associated with implementing and
enforcing outdated or unproductive regulations.
We found that only a few agencies track the costs associated with
conducting their reviews, so we were unable to identify which methods are
most cost effective. Some agency officials, such as those in MSHA,
reported that tracking direct costs associated with reviews is difficult
because reviews are conducted as part of the normal operation of the
agencies and in concert with other actions to fulfill the agencies'
missions. However, some agencies like CPSC establish budgets for their
reviews, and track the associated costs. As a result, CPSC determined that
conducting about four regulatory reviews per year was a reasonable effort
for the associated expense to the agency. OSHA also tracks the costs
associated with its reviews. The agency's officials told us that each of
its reviews typically requires 2/3 of a program analyst FTE in the Office
of Evaluations and Audit Analysis, about 1/5 of an attorney FTE in the
Office of the Solicitor, 1/2 FTE for the involvement of staff from other
directorates, and approximately $75,000 to $100,000 of contractor support
per review.
48 MSHA officials pointed out that, when modifying regulations, the agency
is prohibited from reducing the protection afforded miners by an existing
mandatory health or safety standard. See Section 30 U.S.C. S 811(a)(9).
Although agencies did not always track the cost of their reviews,
officials reported that they know some reviews are not cost effective. For
example, a USDA official reported that, by nature, some regulations are
set up by the agency to be reviewed regularly. Therefore, externally
imposed reviews only duplicate this effort. An example of such reviews
would be those conducted for regulations that are consistently reviewed by
industry committees that are appointed by the Secretary of an agency. AMS
officials reported that industry committees appointed by the Secretary of
Agriculture oversee many of the agency's regulations and, as one of their
main functions, regularly review AMS regulations to identify needed
changes. Therefore, regulations under the purview of these committees are
already constantly being reviewed and updated, and thus may benefit less
from a Section 610 review than other regulations.
Conclusions
Our review revealed that agencies are conducting more reviews, and a
greater variety of reviews, than is readily apparent, especially to the
public. To facilitate their reviews, agencies, to greater and lesser
extents, have been developing written procedures, processes, and standards
to guide how they select which rules to review, conduct analyses of those
rules, and report the results. Given the multiple purposes and uses of
reviews, we recognize that there is no "one size fits all" approach.
However, there are lessons to be learned from ongoing regulatory reviews
that could benefit both the agencies in our scope and others that conduct
retrospective regulatory reviews. Because agencies are attempting to find
ways to further develop and improve their retrospective review processes
(for example, establishing units that focus on retrospective reviews and
seeking assistance with establishing prioritization systems), identifying
ways to share promising practices could collectively improve agency review
activities. Feedback from agency officials and nonfederal parties, as well
as our own analysis, indicate that there are procedures and practices that
may be particularly helpful for improving the effectiveness and
transparency of retrospective review processes. For example, agencies can
be better prepared to undertake reviews if they have identified what data
will be needed to assess the effectiveness of a rule before they start a
review and, indeed, before they promulgate the rule. If agencies fail to
plan for how they will measure the performance of their regulations, and
what data they will need to do so, they may continue to be limited in
their ability to assess the effects of their regulations.
Given increasing budgetary constraints, both agency officials and
nonfederal parties emphasized the need to better prioritize agency review
activities, when possible, to more effectively use their limited
resources. Agency officials and nonfederal parties recognize that time and
resources are too limited to allow for a regular, systematic review of all
of their regulations, and that devoting excessive time and scarce
resources to a formal review of all of their regulations could result in
insufficient attention to other regulatory needs or statutory mandates. As
we have observed, some agencies are already using such prioritization
processes. Without a detailed prioritization system, agencies may not be
able to effectively target their reviews so that they devote resources to
conducting substantive and useful reviews of the regulations that need the
most attention.
Agencies and nonfederal parties also reported that reviews are more
credible and useful to all parties if agencies have assessed multiple
review factors in their analyses of the regulations, rather than relying
on a single factor, such as public comments. The failure of agencies to do
this could result in reviews that miss assessing crucial information that
could provide context to the results of the analysis, such as weighing the
benefits against the burdens of the regulation. Further, our assessment of
the strengths and limitations of agency reviews revealed that agencies
could improve their efforts to employ a standards-based approach to
conducting discretionary reviews. Agencies are inconsistently applying a
standards-based approach to conducting discretionary reviews. Applying a
standards-based approach could enhance the transparency and consistency of
reviews.
Agencies' reporting of reviews appears largely ineffective. None of the
nonfederal parties we contacted were aware of the extent of agency
retrospective review activities. This lack of awareness might be
attributable to two reasons. First, agencies typically did not report
results for discretionary reviews, which account for most of agencies'
review activities. Therefore, the public cannot be expected to know about
these reviews. Second, when agencies do report on their activities, the
mode and content of these communications may not be effective. For
example, although we found that some agencies used multiple modes of
communication, for the most part agencies reported that they rely heavily
on the Federal Register. However, nonfederal parties indicated that
reliance on the Federal Register is not sufficient. Further, the content
that agencies do publish does not always provide adequate information
about the analysis and results of the reviews. Our own assessment showed
that it was sometimes difficult to determine the outcomes of the reviews
or the bases for the agencies' conclusions. Some agencies have employed
multiple communication modes and provided detailed content in their
reports, but still report disappointing levels of public participation.
Therefore, it is clear that agencies need to continue to explore methods
to more effectively communicate and document information about their
reviews and the underlying analyses. According to agency officials and
nonfederal parties, such methods could include using agency Web sites,
e-mail listserves, or other Web-based technologies (such as Web forums).
When agencies do not effectively communicate the analysis and results of
their reviews, they miss the opportunity to obtain meaningful comments
that could affect the outcome of their reviews. Further, without showing
the underlying analysis of reviews, the agencies' conclusions may lack
credibility.
Agencies and nonfederal parties also emphasized the importance of having
high-level support for sustaining agency retrospective review activities,
and increasing their credibility with the public. Without such attention,
agencies will face difficulties in making retrospective review a priority
that receives the resources necessary for conducting successful reviews.
Agencies provided specific examples that illustrated how high-level
management support helped to ensure that they followed through on the
results of regulatory reviews. Although agency officials cautioned that
even high-level management support might not be sufficient to overcome all
budgetary constraints, having such support may ensure that some
retrospective review activity will be sustained.
One of the most striking findings during our review was the disparity in
the perceived usefulness of mandatory versus discretionary regulatory
reviews. The agencies characterized the results of their discretionary
reviews as more productive and more likely to generate further action. A
primary reason for this appears to be that discretionary reviews that
address changes in technology, advances in science, informal agency
feedback, harmonization efforts, and petitions, among other things, may be
more closely attuned to addressing issues as they emerge. While agencies'
officials reported that their discretionary reviews might be more useful
than the mandatory reviews, we can not definitively conclude which reviews
are most valuable. We did not assess the content and quality of
discretionary reviews, and could not have done so because they often were
not documented. Although the officials reported that the bulk of their
review activity is associated with discretionary reviews, they could not
provide evidence to show definitively that this was so or that
discretionary reviews more often generated useful outcomes. Further, one
cannot dismiss the value that Congress anticipated when establishing the
mandatory requirements for agencies to conduct reviews for particular
purposes and on particular schedules.
The predetermined time frames of mandatory reviews can both help and
hinder. On one hand, predetermined schedules are one means by which
Congress can force agencies to periodically reexamine certain regulations.
However, the timing for some mandatory reviews may either be too short or
overlap with other review requirements, making it more difficult for
agencies to produce meaningful analysis from their reviews. Conversely,
from the cursory information that agencies reported for some mandatory
reviews that have review periods as long as 10 years, it appears that
agencies may devote limited time and resources to conducting these
reviews, perhaps partly because the required timelines do not recognize
ongoing changes to regulations.
Further, the criteria used in mandatory and discretionary reviews may be
duplicative. In general, our review of the timing of reviews and the
evaluative factors that agencies are supposed to assess in those reviews
revealed that there is considerable overlap in the various mandatory and
discretionary review requirements. To make efficient use of their time and
resources, agency officials said that they consider all relevant factors,
including effectiveness and burden reduction, whenever they review an
existing regulation. Therefore, when there are duplicative review factors
(such as assessing whether the rule is still needed, overly burdensome, or
overlaps with other regulations), the agency might have already reviewed
and potentially modified the regulation one or more times based upon the
same factors. The officials reported that, although the subsequent reviews
are often duplicative and less productive, they nevertheless expend the
time and resources needed to conduct the reviews in order to comply with
statutory requirements.
Given the long-term fiscal imbalance facing the United States and other
significant trends and challenges, Congress and the executive branch need
to carefully consider how agencies use existing resources. In particular,
overlapping or duplicative reviews may strain limited agency resources. As
agencies face trade-offs in allocating these limited resources to
conducting mandatory and discretionary reviews, as well as conducting
other mission- critical activities, they have to make decisions about what
activities will produce the most benefit. In some cases, we observed that
agencies like FAA delayed conducting any planned reviews for an extended
period because they reported that they did not have the resources to
conduct them. Given the trade-offs that agencies face, it makes sense to
consider the appropriate mix of mandatory and discretionary reviews, and
other mission-critical activities, that agencies can and should conduct.
More specifically, our findings and analysis suggest that it may be useful
to revisit the scope and timing of some review requirements to see whether
there are opportunities to consolidate multiple requirements to enhance
their usefulness and make them more cost effective and easier to
implement. If the current state of review requirements remains unchanged,
agencies may continue to expend their limited time and resources on
conducting pro forma reviews that appear to produce less useful results.
Further, agencies may also continue to produce less useful results for
reviews that they rush to complete, as identified by EPA and FCC officials
who reported that their annual and/or biannual review requirements do not
provide enough time for them to most effectively complete their reviews
and/or observe new changes before starting a subsequent review.
While we believe that employing the lessons learned by agencies may
improve the effectiveness of their retrospective reviews, we acknowledge
that the review of regulations is only one of the tools that agencies will
need to fully understand the implications of their regulatory activities.
In order to fully assess the performance of regulatory activities,
agencies will need to consider the performance of the programs that
implement their regulations and the statutes that underlie the
regulations. Considering any of these elements in isolation will provide
an incomplete picture of the impact of regulations on the public. However,
neglecting any of these elements will have the same effect.
Recommendations for Executive Action
In order to ensure that agencies conduct effective and transparent
reviews, we recommend that both the Director of the Office of Management
and Budget, through the Administrator of the Office of Information and
Regulatory Affairs, and the Chief Counsel for Advocacy take the following
seven actions.
Specifically, we recommend that they develop guidance to regulatory
agencies to consider or incorporate into their policies, procedures, or
agency guidance documents that govern regulatory review activities the
following elements, where appropriate:
1. Consideration, during the promulgation of certain new rules, of
whether and how they will measure the performance of the
regulation, including how and when they will collect, analyze, and
report the data needed to conduct a retrospective review. Such
rules may include significant rules, regulations that the agencies
know will be subject to mandatory review requirements, and any
other regulations for which the agency believes retrospective
reviews may be appropriate.
2. Prioritization of review activities based upon defined
selection criteria. These criteria could take into account factors
such as the impact of the rule; the length of time since its last
review; whether changes to technology, science, or the market have
affected the rule; and whether the agency has received substantial
feedback regarding improvements to the rule, among other factors
relevant to the particular mission of the agency.
3. Specific review factors to be applied to the conduct of
agencies' analyses that include, but are not limited to, public
input to regulatory review decisions.
4. Minimum standards for documenting and reporting all completed
review results. For reviews that included analysis, these minimal
standards should include making the analysis publicly available.
5. Mechanisms to assess their current means of communicating
review results to the public and identify steps that could improve
this communication. Such steps could include considering whether
the agency could make better use of its agency Web site to
communicate reviews and results, establishing an e-mail listserve
that alerts interested parties about regulatory reviews and their
results, or using other Web-based technologies (such as Web
forums) to solicit input from stakeholders across the country.
6. Steps to promote sustained management attention and support to
help ensure progress in institutionalizing agency regulatory
review initiatives.
We further recommend that, in light of overlapping and duplicative review
factors in statutorily mandated reviews and the difficulties identified by
agencies in their ability to conduct useful reviews with predetermined
time frames, the Administrator of OIRA and Chief Counsel for Advocacy take
the following step.
7. Work with regulatory agencies to identify opportunities for
Congress to revise the timing and scope of existing regulatory
review requirements and/or consolidate existing requirements.
Matters for Congressional Consideration
In order to facilitate agencies' conduct of effective and transparent
reviews, while maximizing their limited time and resources, Congress may
wish to consider authorizing a pilot program with selected agencies that
would allow the agencies to satisfy various retrospective review
requirements with similar review factors that apply to the same
regulations by conducting one review that is reported to all of the
appropriate relevant parties and oversight bodies.
Agency Comments
We provided a draft of this report to the Secretary of Agriculture, the
Attorney General, the Secretary of Labor, the Secretary of Transportation,
the Administrator of EPA, the Administrator of SBA, the Acting Chairman of
CPSC, the Chairman of FCC, the Chairman of FDIC, the Director of OMB, and
the Chief Counsel for Advocacy for their review and comment.
We received formal comments from the SBA Office of Advocacy; they
concurred with the recommendations and, as an attachment, provided a copy
of draft guidance that they developed in response to our recommendations
(see app. XII). The Office of Advocacy also suggested that it would be
more appropriate to direct the recommendations to the Chief Counsel of
Advocacy rather than the Administrator of SBA. Because the Chief Counsel
of Advocacy is the official who would need to act upon these
recommendations, we made the change.
OMB told us that they reviewed our draft report and had no comments. All
other agencies provided technical and editorial comments, which we
incorporated as appropriate. In its technical comments, DOT suggested that
we expand the recommendation for agencies to identify opportunities for
Congress to examine the timing and scope of existing requirements and/or
consolidate existing requirements, to include executive agency mandated
reviews. However, the focus of the recommendation is on statutory
requirements because they tended to have recurring and/or predetermined
review schedules. Therefore, we did not expand the recommendation.
As we agreed with your office, unless you publicly announce the contents
of this report earlier, we plan no further distribution of it until 30
days from the date of this letter. We will then send copies of this report
to interested congressional committees, the Secretary of Agriculture, the
Attorney General, the Secretary of Labor, the Secretary of Transportation,
the Administrator of EPA, the Administrator of SBA, the Acting Chairman of
CPSC, the Chairman of FCC, the Chairman of FDIC, the Director of OMB, the
Administrator of OIRA, and the Chief Counsel for Advocacy. Copies of this
report will also be available at no charge on our Web site at
[83]http://www.gao.gov .
If you or your staff have any questions about this report, please contact
me at (202) 512-6806 or [84][email protected] . Contact points for our
Offices of Congressional Relations and Public Affairs may be found on the
last page of this report. Key contributors to this report are listed in
appendix XIII.
Mathew J. Scire
Director
Strategic Issues
Appendix I: Objectives, Scope and Methodology
Objectives
To provide insights concerning how agencies assess existing regulations,
congressional requesters asked us to examine agencies' implementation of
retrospective regulatory reviews and the results of such reviews.
Accordingly, for selected agencies, we are reporting on:
1. the magnitude of retrospective review activity and type of
retrospective reviews agencies completed from calendar year 2001
through 2006, including the frequency, impetus (mandatory or
discretionary), and purposes of the reviews;
2. the processes and standards that guide agencies' planning,
conduct, and reporting on reviews, and the strengths and
limitations of the various review processes and requirements;
3. the outcomes of reviews, including the perceived usefulness of
the reviews and how they affected subsequent regulatory
activities; and
4. the factors that appear to help or impede agencies in
conducting or using retrospective reviews, including which
methods, if any, that agencies and we identified as most
cost-effective for conducting reviews.
For purposes of this report, we generally use the term retrospective
reviews to mean any assessment of an existing regulation, primarily for
purposes of determining whether (1) the expected outcomes of the
regulation have been achieved; (2) the agency should retain, amend, or
rescind the regulation; and/or (3) the actual benefits and costs of the
implemented regulation correspond with estimates prepared at the time the
regulation was issued. We defined mandatory reviews as retrospective
reviews that agencies conducted in response to requirements in statutes,
executive orders, or executive branch directives. We defined discretionary
reviews as reviews that agencies undertook based upon their own
initiative.
Scope
For calendar years 2001 through 2006, we assessed the retrospective review
activities of nine agencies and their relevant subagencies. The nine
agencies included the Departments of Agriculture, Justice, Labor, and
Transportation; Consumer Product Safety Commission (CPSC); Environmental
Protection Agency (EPA); Federal Communications Commission (FCC); Federal
Deposit Insurance Corporation (FDIC); and the Small Business
Administration(SBA). The subagencies covered in detail by our review
included USDA's Animal and Plant Health Inspection Service, Agricultural
Marketing Service, and Food Safety and Inspection Service; Department of
Justice's Bureau of Alcohol, Tobacco, Firearms, and Explosives; Department
of Labor's Employee Benefits Security Administration, Occupational Safety
and Health Administration, Mine Safety and Health Administration, and
Employment and Training Administration; and the Department of
Transportation's Federal Aviation Administration and National Highway
Traffic Safety Administration.
We selected these agencies because they include Cabinet departments,
independent agencies, and independent regulatory agencies covering a wide
variety of regulatory activities in areas such as health, safety,
environmental, financial, and economic regulation.1 Further, we selected
these agencies because they were actively conducting regulatory reviews or
were responsible for responding to multiple review requirements. We were
not able to assess the activities of all regulatory agencies, due to time
and resource constraints, but given the diversity and volume of federal
regulation conducted by the nine selected agencies, we believe that the
results of our assessment should provide a reasonable characterization of
the variety of retrospective regulatory reviews and the issues associated
with their implementation. GAO's Federal Rules Database, which is used to
compile information on all final rules, showed that the nine agencies
accounted for almost 60 percent of all final regulations published from
2001 through 2006.2 However, the volume and distribution of reviews
covered in this report are not generalizable to all regulatory reviews
governmentwide. To supplement our assessment of these agencies'
activities, we also solicited the perspectives of regulatory oversight
entities and nonfederal parties knowledgeable about regulatory issues,
such as the Office of Information and Regulatory Affairs within the Office
of Management and Budget, the Office of Advocacy within SBA, and 11
nonfederal parties that represented a variety of sectors (academia,
business, public advocacy, and state government).
1The term "independent regulatory agencies" refers to the boards and
commissions identified as such in the Paperwork Reduction Act (44 U.S.C. S
3502(5)), including CPSC, FCC, and FDIC. "Independent agencies" refers to
agencies that answer directly to the President but are not part of Cabinet
departments.
2The Congressional Review Act (CRA) requires agencies to file final rules
with both Congress and GAO before the rules can take effect. To compile
information on all the rules submitted to us under CRA, GAO established a
database and created a standardized submission form to allow more
consistent information collection. We determined that the data in the
database were sufficiently reliable for the purpose for which it was used.
The Federal Rules Database is publicly available at [85]www.gao.gov under
Legal Products.
Methodology
To address our first objective, we interviewed and obtained documentation
from agency officials as well as other knowledgeable regulatory parties on
agency retrospective reviews. We administered and collected responses to a
structured data collection instrument that solicited information on
agencies' retrospective review activities and lessons learned. We
supplemented this data collection by obtaining information from the
Federal Register, Unified Agenda, and published dockets and agency
reports. We used information obtained to describe the "types" of reviews
that agencies conducted--in terms of impetus (mandatory or discretionary)
and purpose (for example, burden reduction or effectiveness). We compared
agency review activities in terms of impetus and purpose because important
differences can be seen in the processes used, outcomes derived, and
lessons learned, based upon these characteristics, which we further
analyze in objectives two through four. Although we note that reviews can
be described and compared using other characteristics, such as policy area
assessed in the review (such as health, safety, or economic) or type of
analyses conducted (such as economic benefit-cost analysis, other
quantitative, and qualitative), we believe our selection of
characteristics in describing the types of reviews conducted was most
useful and relevant for addressing our objectives.
To address our second objective, we interviewed and obtained documentation
from agency officials as well as other knowledgeable regulatory parties on
agency retrospective reviews. We collected responses to the aforementioned
structured data collection instrument that solicited information on
agencies' retrospective review activities and lessons learned. We
supplemented this data collection by obtaining information from the
Federal Register, Unified Agenda, and published dockets and agency
reports. We also reviewed agency policies, executive orders, and statutory
requirements to identify policies and procedures that guide the planning,
conduct, and reporting of agencies' reviews. Further, to identify the
strengths and limitations of agency review processes, we assessed
agencies' use of three review and economic practices and standards that
are important to the effectiveness and transparency of agency reviews,
including the (1) use of a standards-based approach, (2) incorporation of
public involvement, and (3) documentation of review processes and results.
In prior work, we identified some overall strengths or benefits associated
with regulatory process initiatives, including: increasing expectations
regarding the analytical support for proposed rules, encouraging and
facilitating greater public participation in rulemaking, and improving the
transparency of the rulemaking process. Because these strengths or
benefits are also relevant and useful for assessing agency retrospective
review initiatives, we considered them in our selection of assessment
criteria for this review. Other practices that could improve the
effectiveness and transparency of reviews may exist and could be
considered when developing retrospective review processes. However, we
believe that the three practices that we assessed are among the most
important. While we did not assess whether agencies employed these
practices all the time, to the extent possible we did seek documentation
and evidence that they were applied. Further, while we assessed whether
agencies employed standards-based approaches in their retrospective review
processes--within the scope of our review--we did not attempt to assess
the quality of such standards. We compared the strengths and limitations
of review processes across agencies, types of reviews, and phases of the
review process. In our more detailed assessment of a limited sample of
retrospective reviews completed between 2001 and 2006, we also evaluated
the use of research and economic practices and standards. The sample that
we assessed was too small to generalize to all agency retrospective
reviews, but this assessment illustrated some of the strengths and
limitations that exist in the agencies we reviewed.
To address the third objective, we interviewed and obtained documentation
from agency officials and collected responses on the usefulness of various
types of retrospective reviews using the structured data collection
instrument identified in objective one. To obtain the perspectives of
nonfederal parties on the usefulness of agency reviews, we identified and
interviewed 11 parties that represent a variety of sectors (academic,
business, public, advocacy, and state government) and points of view. 3
The parties were selected based on their contributions to prior GAO work
on regulatory issues and our assessment of their recent publications on
regulatory issues. The opinions expressed by agency officials and these
nonfederal parties may be subjective and may not capture the views of all
regulatory agencies, experts, and stakeholders on the usefulness of
reviews. However, we believe that our selection represents a reasonable
range of knowledgeable perspectives on retrospective reviews. We
supplemented our data collection on the outcomes of agency reviews by
reviewing the Federal Register, Unified Agenda, and published dockets and
reports. For mandatory and discretionary reviews, we identified the
reported results of reviews, including whether the review prompted any
change to existing regulations. We also synthesized and described the
usefulness of different types of reviews, as determined by agency
officials and nonfederal parties knowledgeable about regulatory issues.
3We interviewed 15 individuals from 11 separate groups that represented
the various sectors listed. Specifically, we interviewed 3 groups from
academia, 3 groups that represent public advocacy, 3 groups that represent
business advocacy, and 2 groups that represent state and local government.
To address the fourth objective, we interviewed and obtained documentation
from agency officials, collected responses to a structured data collection
instrument, and reviewed existing research on agency regulatory review
initiatives. Further, we solicited perspectives of the selected oversight
and nonfederal parties on the facilitating factors and barriers to the
usefulness of agency reviews. Based on our analysis of agency responses
and documentation, we described the lessons learned from the different
agencies, and the views of oversight and nonfederal parties on
facilitating and impeding practices. To supplement the lessons identified
and to identify the most prevalent and/or critical facilitators or
barriers for the conduct and usefulness of reviews, as well as options to
overcome any barriers identified, we hosted a joint agency exit
conference. During this joint exit conference, we discussed the collective
responses of agencies and nonfederal parties, and similarities and
differences in experiences and views.4 We had general consensus among
federal agencies on the points discussed during this exit conference and
report on areas where there was not consensus in agency and nonfederal
parties' views. We conducted our work from May 2006 through April 2007 in
accordance with generally accepted government auditing standards.
4We held a separate exit meeting with the Department of Justice and
discussed the same information presented at the joint agency exit meeting.
Appendix II: Department of Agriculture Retrospective Reviews
The three Department of Agriculture (USDA) agencies examined in this study
actively reviewed their existing regulations under both mandatory and
discretionary authorities. The Animal and Plant Health Inspection Service
(APHIS), the Agricultural Marketing Service (AMS), and the Food Safety and
Inspection Service (FSIS) conducted reviews to reduce burden on small
entities under Section 610. USDA conducted discretionary reviews to
respond to industry petitions or informal feedback, to meet
recommendations from committees, to address new risks in regulated
environments, or to update rules due to advances in technology or
scientific knowledge. The agencies use both centralized and decentralized
review processes that rely on the input of outside parties to inform their
reviews.
USDA Retrospective Reviews
The three USDA agencies examined in this study actively reviewed their
existing regulations under both mandatory and discretionary authorities,
with reviews conducted at their own discretion more common than mandated
reviews. For example, during the 2001 through 2006 period covered in our
review, APHIS reported conducting 18 Section 610 reviews and completing
rulemakings for 9, with 8 others currently in progress. APHIS also
reported that since 2001, it has completed a total of 139 regulatory
reviews, which resulted in 139 rule modifications across 12 broad content
areas. AMS officials reported initiating 19 and completing 11 Section 610
reviews since 2001. However, AMS also reported that it has issued
approximately 300 modifications to 30 regulations based on interaction
with Industry Committees between fiscal years 2002 and 2006. In addition,
AMS also reported that since 2001, the agency has conducted 18 independent
assessments of its commodity promotion programs, as required of AMS under
7 U.S.C. S 7401. FSIS reported initiating 1 Section 610 review since 2001;
however during the same time period, the agency has conducted 36 reviews
of its rules as a result of industry petitions. The agencies' officials
reported that discretionary reviews more often resulted in regulatory
changes. Our analysis of the December 2006 Unified Agenda confirmed that
most modifications to the department's regulations were attributed to
reasons under USDA's own discretion rather than because of mandates. Of
the 132 rule changes listed in the Unified Agenda, 113 resulted from
decisions made at agency discretion while 19 of those changes were the
result of mandated actions.
Table 4: Description of USDA Retrospective Reviews
Mandatory reviews Discretionary reviews
Review o Section 610 o Agency discretion
authorities o AMS: Commodity o USDA internal policy to
Promotion and review significant rules
Evaluation under 7 every 5 years
U.S.C. S 7401
Frequency o 10 years (Section o As needed based on
610) industry feedback or
o 5 years (AMS petition
Commodity Promotion o 5 years (USDA internal
and Evaluation) policy)
Purposes o Reduce economic o Respond to industry
impact on small petitions, recommendations
entities from committees
o Reduce complexity of o Advances in technology,
regulation science
o Consolidate o Meet emerging risks
duplicative rules (disease, pests)
o Respond to changes o Align with international
over time in standards
technology, economic o Requests from trading
conditions partners, states
o Evaluate program o Feedback from regulated
effectiveness and communities
ensure that the o Respond to new, revised
objectives of the legislation
program are being met o Reduce complexity of
(AMS Commodity regulation
Promotion and o Consolidate duplicative
Evaluation) rules
o Respond to changes over
time in technology, economic
conditions
General outcomes o APHIS: 9 of 18 o APHIS: Rule changes vary
reviews have resulted in terms of less/more
in completed stringent.
rulemaking o FSIS: According to
proceedings. Five officials, 8 of the 36
other proceedings are reviews from petitions
pending completion. resulted in changes, and
o AMS: All 11 generally less stringent
completed Section 610 rules.
reviews have resulted o 113 of the 132 rule
in no changes. changes listed in the
o FSIS: The only December 2006 Unified Agenda
Section 610 review resulted from decisions made
conducted has yet to under agency discretion.
be reported.
Agency views on o APHIS officials o FSIS officials reported
reported that periodic that reviews focus the
usefulness of reviews are less agency's efforts on
reviews useful, as small measuring a regulation's
modifications are made effectiveness and
to regulations on determining whether a
ongoing basis. particular policy is still
o AMS officials consistent with the agency's
reported that Section overall policy direction.
610 reviews have not
identified issues that
were not previously
known through other
oversight mechanisms.
Source: GAO analysis of agency data and regulatory statutes.
USDA Retrospective Review Processes
The processes employed for review varied by agency, with AMS program
offices conducting reviews of their own regulations, APHIS program offices
conducting reviews in concert with centralized offices within the agency,
and centralized offices within the agency conducting FSIS reviews.
However, all three agencies relied on the input of regulated communities
to inform their processes. As an example of a centralized approach: APHIS'
technical and policy program staff work with the agency's Policy and
Program Development (PPD) unit to conduct reviews, and PPD works with the
Deputy Administrators for each regulatory program to set regulatory
priorities. The program staff that oversees the regulation, on the other
hand, conducts AMS reviews, in-house. All three agencies reported that
they rely on outside parties to inform their review process. For example,
AMS reported that the agency conducts periodic referenda of regulated
growers of fruit and vegetables to amend agency marketing orders and to
identify programs for discontinuance. APHIS reported that its review
decisions are influenced by ongoing discussions with industry, state and
tribal authorities, and foreign governments regarding setting
international trade standards. APHIS also reported that it has acted on
recommendations made by outside reviews of its programs conducted by the
National Plant Board and the National Association of State Departments of
Agriculture. FSIS reported that it holds industry listening sessions and
public meeting to inform its rulemaking and affect the day-to-day
implementation of regulations. Figure 5 depicts USDA's general process for
regulatory review.
Figure 5: USDA Review Process
Appendix III: Department of Justice Retrospective Reviews
While the Department of Justice (DOJ) is not primarily a regulatory
agency, during the 2001 through 2006 period covered in our review, DOJ
component agencies have conducted reviews of their existing regulations
under both mandatory review requirements and under their own discretionary
authorities.1 Most DOJ reviews were discretionary and in response to such
drivers as changes in technology or feedback back from regulated entities,
among other factors. The three mandatory reviews conducted by DOJ since
2001 were driven by separate statutory requirements to review regulations
or set enforceable standards for others to follow. While DOJ has few
formal processes or standards to guide the planning, conduct, and
reporting of its internally conducted discretionary reviews, in the
conduct of the one Section 610 review conducted by DOJ and evaluated by
GAO, statutory standards were followed.
DOJ Retrospective Review Activity
DOJ is not primarily a regulatory agency and officials reported that most
of its primary activities, including antiterrorism, investigation, and law
enforcement do not involve the department's regulatory process. Officials
reported that few of the department's regulations are subject to Section
610 review, and one official reported that regulatory review, as a whole,
is not a major priority within the agency, compared to its other
functions. However, since 2001 DOJ agencies reported completing at least
13 reviews of existing regulations. Based on published documents in the
Federal Register or Unified Agenda, 10 of these reviews were conducted
under DOJ's own discretion, while 3 reviews were in response to mandatory
review requirements or to comply with statutory requirements to revise
regulations.
The drivers for the discretionary reviews conducted by DOJ included
responding to changes in technology or feedback from regulated entities,
among other factors. For example, FBI officials reported that the Bureau
has reviewed and is revising a rule preventing the FBI from retaining or
exchanging the fingerprints and criminal history record information of
nonserious offenses in the FBI's Fingerprint Identification Records
System. According to the proposed rule change resulting from this review,
the existing regulations were originally implemented in 1974 and based on
the data-processing capabilities of a manual record-keeping environment.
Officials reported that advances in information technology precipitated a
review of these regulations, which once revised, will enhance the FBI's
search capability for fingerprint and criminal history background checks.
DOJ also cited feedback from regulated entities as an important driver of
discretionary reviews. DEA, for example, reported that the controlled
substance manufacturer and distributor industries requested that DEA
provide an electronic method to satisfy the legal requirements for
ordering Schedule I and II controlled substances, which previously could
only be ordered through a triplicate form issued by DEA. According to
officials, DEA reviewed its regulations and worked with industry to
develop a pilot program to update its system. After notice-and-comment
rulemaking, DEA published a Final Rule revising its regulations on April
1, 2005.2
1The DOJ agencies included in our review were the Bureau of Alcohol,
Tobacco, Firearms, and Explosives (ATF); Civil Rights Division (CRT);
Federal Bureau of Investigations (FBI); Drug Enforcement Administration
(DEA); Bureau of Prisons (BOP); Executive Office for Immigration Review;
and the Office of Justice Programs (OJP).
In addition to these reviews, ATF conducted five discretionary reviews
since 2001, including a reorganization of Title 27 in the transition of
ATF functions from the Department of the Treasury to DOJ after the
creation of the Department of Homeland Security.3 Additionally, OJP
conducted two discretionary reviews since 2001 and the BOP reported that
it conducts annual, ongoing reviews of its Policy Statements, many of
which correspond with its regulations in the CFR, to ensure that they are
current.
GAO was able to identify three mandatory regulatory reviews completed by
DOJ since 2001, and the impetuses for these reviews varied. For example,
ATF in 1997 initiated a Section 610 review evaluating the impact of
changes to its fireworks storage and record-keeping requirements on small
entities.4 This review, concluded in a January 29, 2003, Federal Register
notice, certified that the revised rule will have a minimal economic
impact on the explosives industry, and will no longer have a significant
economic impact on a substantial number of small entities.5 The review
also identified other areas of concern to the public, precipitating
further actions. CRT conducted a review pursuant to Executive Order 12250,
which requires the Attorney General to establish and implement a schedule
for the review of executive branch agencies' regulations implementing
various federal nondiscrimination laws, including the Civil Rights Act of
1964, among others.6 According to officials, this "Cureton Review Project"
included an evaluation of the regulations of 23 agencies, including DOJ,
which resulted in clarified statutory language to promote consistent
compliance with the various nondiscrimination statutes.7 In a third
review, CRT published an Advanced Notice of Proposed Rulemaking (ANPRM) to
update regulations implementing Title II and Title III of the Americans
with Disabilities Act of 1990 (ADA), including the ADA Standards for
Accessible Design.8 According to the ANPRM, the ADA requires DOJ to adopt
accessibility standards that are ``consistent with the minimum guidelines
and requirements issued by the Architectural and Transportation Barriers
Compliance Board," which were revised in July 2004. DOJ has also reported
that it may conduct a Regulatory Impact Analysis on the revised ADA
standards, including a benefit-cost analysis pursuant to Executive Order
12866, OMB Circular A-4, and the Regulatory Flexibility Act.
270 Fed. Reg. 16,902 (Apr. 1, 2005).
368 Fed. Reg. 3744 (Jan. 24, 2003).
462 Fed. Reg. 1386 (Jan. 10, 1997).
568 Fed. Reg. 4406 (Jan. 29, 2003).
Table 5: Description of DOJ Retrospective Reviews
Mandatory reviews Discretionary reviews
Review o Section 610 o BOP internal
authorities o Executive Order 12250 policy to annually
(implementation of federal review its Program
nondiscrimination laws) Statements
o Revision of ADA Accessible
Design Standards
Frequency o 10 years (Section 610) o As needed, based
o Executive Order 12250 on the feedback of
(Attorney General sets regulated
evaluation schedule) communities
o ADA Standards are revised as o Annually (BOP)
needed to enforce standards
revised by the Architectural
and Transportation Barriers
Compliance Board
Purposes o Reduce economic impact on o Respond to
small entities petitions, feedback
o Reduce complexity of from regulated
regulation communities, law
o Consolidate duplicative enforcement
rules agencies, advisory
o Respond to changes over time boards
in technology, economic o Changes in
conditions technology,
statutes, standards
o Ensure that
regulations are
current (BOP)
General outcomes o In the ATF Section 610 o ATF reported four
review, ATF certified that the discretionary
revised rule will have a reviews since 2001
minimal economic impact on the which resulted in
explosives industry, and will rulemaking
no longer have a SIESNOSE. proceedings.
However, the review identified
additional issues for further
action.
o CRT's Executive Order 12250
review resulted in
clarification of regulatory
language within federal agency
programs.
Agency views on ATF officials reported that reviews ensure that ATF is
usefulness of meeting the needs of government, industry, and the law
reviews enforcement community while meeting legislative mandates.
Source: GAO analysis of agency data and regulatory statutes.
645 Fed. Reg. 72,995 (Nov. 2, 1980).
768 Fed. Reg. 51,334 (Aug. 26, 2003).
869 Fed. Reg. 58,768 (Sept. 30, 2004).
DOJ Review Process
Department officials stated that much of DOJ's regulatory review process
was "informally" structured, and without formal procedures and standards.
Professional judgment, officials stated, was used in some cases in lieu of
documented practices. However, a GAO evaluation of the recent ATF
Explosive Materials in the Fireworks Industry review indicates that DOJ
followed the statutorily defined process for its completion. As required
by Section 610, the review must describe (a) the continued need for the
rule; (b) the nature of complaints or comments received concerning the
rule from the public; (c) the complexity of the rule; (d) the extent to
which the rule overlaps, duplicates, or conflicts with other federal rules
and, to the extent feasible, with state and local governmental rules; and
(e) the length of time since the rule has been evaluated or the degree to
which technology, economic conditions, or other factors have changed in
the area affected by the rule. GAO's evaluation of this proceeding
concluded that ATF addressed the requirements for responding to public
comments, complaints, and the rule's complexity. ATF's analysis was
primarily in response to public comments and a review of its own
experience implementing the rule. In a few cases, ATF responded to
comments by referencing published experts' opinions and scientific tests.
However, ATF provided no overall analysis of the cost of these storage
regulations or of their effectiveness in promoting public safety, or law
enforcement's ability to trace fireworks to their manufacturer--a specific
desired outcome referred to in the notice.9 Figure 6 depicts the general
process for regulatory review in one ATF Section 610 review.
9 68 Fed. Reg. 4406 (Jan. 29, 2003).
Figure 6: ATF Section 610 Review, Explosive Materials in the Fireworks
Industry
Appendix IV: Department of Labor Retrospective Reviews
During the 2001 through 2006 period covered in our review, agencies within
the Department of Labor (DOL) have actively reviewed their existing
regulations in response to both mandatory and discretionary drivers.
Specifically, the Employee Benefits Security Administration (EBSA),
Occupational Safety and Health Administration (OSHA), Mine Safety and
Health Administration (MSHA), and Employment and Training Administration
(ETA) have conducted various retrospective reviews of their regulations.
The types of reviews--in terms of impetus and purpose--outcomes of reviews
and processes used to conduct the reviews varied among the agencies.
Specifically, while EBSA has established a formal and documented
regulatory review program, OSHA, MSHA, and ETA have somewhat less formal
review programs, but MSHA and ETA were in the process of developing more
standardized processes. Furthermore, while all of the agencies reported
that their discretionary reviews more often resulted in subsequent
regulatory action, the outcomes of mandatory reviews varied slightly among
the agencies.
DOL Retrospective Review Activity
All of the DOL agencies within our review reported actively conducting
reviews of their regulations. However, the types of reviews--in terms of
impetus and purpose--and outcomes of reviews varied slightly among the
agencies. All of the DOL agencies reported that they conducted ongoing
reviews of their regulations, at their own discretion. However, two of the
agencies--OSHA and EBSA--also incorporated requirements from mandatory
reviews into these discretionary reviews. Furthermore, EBSA conducts its
discretionary reviews more formally as part of its Regulatory Review
Program. According to documentation that we reviewed on this program, EBSA
formally conducted reviews of its existing regulations in response to
specific developments and/or changes in the administration of group
health, pension, or other employee benefit programs, changes in technology
and industries, and legislation. EBSA also reviewed regulations in
response to identified enforcement problems or the need to further the
agency's compliance assistance efforts through improved guidance.
Furthermore, the review program incorporates Section 610 reviews as part
of the program. While OSHA did not have a program that was as formalized
and documented as EBSA, the officials reported and our review of their
analyses confirmed that the agency also incorporated Section 610 criteria
into broader review initiatives that the agency undertook to address
informal feedback from industry, stakeholders, and staff. MSHA and ETA
also reported initiating reviews in response to either stakeholder input,
technology or policy updates, petitions, or internal identification of
needed rule changes. However, the agencies' officials reported that they
have not conducted any Section 610 reviews (which focus on burden
reduction) during the period covered in our review because they have not
had any regulations within the last 10 years that had a SEISNOSE effect.
Outcomes of reviews varied slightly among the agencies. While it was not
possible to account for all of the reviews conducted by all of the
agencies because the agencies did not document some informal reviews,
collectively the agencies reported completing at least 60 reviews since
2001. According to EBSA documentation, the agency completed at least 7 of
its 13 formal retrospective reviews, including 4 Section 610 reviews. All
of the discretionary reviews resulted in subsequent regulatory changes,
including changes to the regulation, guidance, or related materials. None
of EBSA's Section 610 reviews resulted in regulatory changes. OSHA
completed 4 reviews in response to both discretionary and Section 610
requirements which resulted in regulatory changes or changes to guidance
documents or related materials. According to OSHA documentation, 2 of
their completed Section 610 reviews and 2 of their Standards Improvement
Project Reviews recommended regulatory changes, including clarifications
to standards or additional outreach or compliance assistance materials.
MSHA officials reported engaging in a 2004 MSHA Strategic Initiative
Review (a review of all Title 30 CFR regulations) and a review conducted
according to an MSHA initiative to improve and eliminate regulations that
were frequently the subject of petitions for modification. Both of these
reviews resulted in changes to regulations. ETA officials reported that,
in 2002, the agency conducted a regulatory cleanup initiative that
resulted in updates to individual regulations and that ETA has updated
individual regulations when the agency's program offices identified a need
to do so through their course of business. The agencies also reported
making regulatory changes based upon departmentwide regulatory cleanup
initiatives in 2002, and 2005/2006, which the department's Office of the
Assistant Secretary for Policy spearheaded. Additionally, the department
completed 42 reviews in response to Office of Management and Budget (OMB)
regulatory reform nominations from 2001 to 2004, which resulted in
subsequent regulatory action.1
1OSHA completed 24 of the 42 DOL reviews conducted in response to the OMB
initiatives.
Table 6: Description of DOL Retrospective Reviews
Mandatory reviews Discretionary reviews
Review o Section 610 o Agency initiatives in
Authorities response to technology
changes, petitions,
enforcement and compliance
issues
o Department Regulatory
Clean Up Initiative (all
agencies, including OSHA,
EBSA, and ETA)
o EBSA: Reviews also
conducted under the
agency's formal Regulatory
Review Program
Frequency o Every 10 years o Discretionary reviews are
o MSHA and ETA: No completed as needed
reviews conducted under o Departmentwide Review
this authority Initiatives occurred at
least twice
o EBSA: Regulatory Review
Program reviews are
conducted annually
Purposes o Reduce burden on o Effectiveness (for
small entities example, performance
o Reduce complexity of measurement or other
regulation measurements of efficiency)
o Consolidate o Improved enforcement and
duplicative rules compliance
o Respond to changes o Burden reduction
over time in
technology, economic
conditions
General outcomes o EBSA: No changes to o Subsequent regulatory
regulations action (e.g., changes to
o OSHA: When Section regulations, guidance, or
610 and discretionary related materials)
reviews were combined,
reviews resulted in
some changes.
Agency views on o EBSA officials o Burden reduction
usefulness of reported Section 610 o Officials reported that
reviews mandatory review reviews are useful to
requirements are less identifying whether: (1)
comprehensive than the agency is achieving its
their discretionary goals, or (2) regulation or
reviews because they guidance changes are
are limited to needed. MSHA also reported
regulations with reviews are useful to
SEISNOSE and focus saving costs associated
primarily on with reviewing several
deregulation. petitions for a rule that
o OSHA officials needs modification.
reported Section 610
mandatory review
criteria were
reasonably clear and
relevant, while
Executive Order 12866
criteria are less
concise.
Source: GAO analysis of agency data and regulatory statutes.
DOL Retrospective Review Processes
The development of review processes for DOL agencies ranged from processes
that were documented and formal with established review structures and
procedures, to informal undocumented review processes with structures and
procedures that were still developing. For example, EBSA established a
formal review program that established a formal structure for reviews,
including identification of what resources (staff) would be involved,
criteria that the agency would use to select and assess regulations, and
the method for reporting results. While OSHA did not have a documented
formal review program, the agency described a somewhat formal structure
that it uses to conduct its reviews. Similarly, ETA officials reported
that they just recently established a more formal structure for their
review process, including the creation of a Regulations Unit that will
coordinate the development of regulations for ETA legislative
responsibilities and formalize regulatory procedures within the agency.
According to the officials, the Regulations Unit will establish time
frames and/or internal triggers for reviews to ensure the agency properly
reviews and updates regulations. However, they noted that, given the
recent establishment of this unit, it might take some time to implement
these procedures. MSHA did not appear to have a documented formal review
process or structure for its discretionary and mandatory reviews. However,
the agency reported that it had been engaged in soliciting contractors to
develop a more formal process for how to prioritize what regulations that
agency would review. Figures 7 and 8 illustrate an example of the
variation in the agencies' review processes. To facilitate sharing
practices, in appendix XI we provide a more detailed description of
practices within EBSA's review process, which was the most formalized and
documented review process that we examined within the scope of our review.
Figure 7: EBSA Retrospective Review Process
Figure 8: OSHA Retrospective Review Process
Appendix V: Department of Transportation Retrospective Reviews
Between 2001 and 2006, Department of Transportation (DOT) agencies within
the scope of our evaluation actively reviewed their existing regulations
under both mandatory and discretionary authorities.1 The mandatory reviews
conducted by DOT agencies addressed governmentwide, departmentwide, and
agency-specific review requirements. DOT conducted discretionary reviews
in response to formal petitions and informal feedback from the public and
in response to accidents or similar events and changes in specific
industries, technologies, or underlying standards. Additionally, DOT
conducted reviews in response to Office of Management Budget (OMB)
regulatory reform initiatives as well as a stand-alone initiative to
review all rules under the department's authority. DOT has written
policies and procedures guiding the planning, conduct, and reporting of
reviews. While review processes may vary somewhat within DOT agencies,
overall these agencies follow DOT guidelines in the conduct of their
reviews.
DOT Retrospective Review Activity
DOT has conducted a number of initiatives to systematically review
existing regulations to comply with federal mandates and DOT's own
policies and procedures for regulatory review. In order to satisfy Section
610 and other review requirements, DOT initiated a 10-year plan in 1998 to
systematically review some of its sections of the Code of Federal
Regulations every year, with the objective of reviewing all of its
regulations over a 10-year cycle. DOT also maintains a departmentwide
review requirement, instituted in 1979, to periodically review existing
regulations to determine whether they continue to meet the needs for which
they originally were designed or whether reviewed rules should be revised
or revoked. More recently, in 2005, acting under its own discretion, DOT
initiated and completed a special stand-alone regulatory review in which
the department sought public comment on all rules and regulations under
DOT's authority. DOT also reviewed regulations in response to OMB
initiatives in 2001, 2002, and 2004, which solicited nominations from the
general public for federal regulations and guidance documents for reform.
The agency completed 61 reviews in response to these reform initiatives,
and the department took subsequent action on 43 of the regulations it
reviewed. Overall, during the 2001 through 2006 period covered in our
review, DOT has reported conducting over 400 reviews of existing
regulations to meet governmentwide review requirements, including those
under Executive Order 12866 on Regulatory Planning and Review, Section
610, and the Executive Memorandum of June 1, 1998, on Plain Language in
Government Writing.2
1The DOT includes the Office of the Secretary (OST) and the following
operating administrations: Federal Aviation Administration (FAA); Federal
Highway Administration (FHWA); Federal Motor Carrier Safety Administration
(FMCSA); Federal Railroad Administration (FRA); Federal Transit
Administration (FTA); Maritime Administration (MARAD); National Highway
Traffic Safety Administration (NHTSA); Pipeline and Hazardous Materials
Safety Administration (PHMSA); Research and Innovative Technology
Administration (RITA); and St. Lawrence Seaway Development Corporation
(SLSDC). The components of DOT have changed since 2001. For example, with
the establishment of the Department of Homeland Security (DHS) in 2003,
the U.S. Coast Guard and the Transportation Security Administration were
transferred from DOT to DHS.
In addition to reviews conducted under departmentwide requirements,
various agencies within DOT have reviewed regulations within the specific
statutes under their purview. For example, since 2001 FAA has reviewed
three regulations pursuant to requirements in the Federal Aviation
Reauthorization Act of 1996. According to agency officials, these reviews
included post implementation cost-benefit assessments of three, high-cost
FAA rules. FMCSA reported that it also reviews any regulation impacted by
the Motor Carrier Act of 1980; the Motor Carrier Safety Improvement Act;
and the Safe, Accountable, Flexible, Efficient Transportation Equity Act:
A Legacy for Users (SAFETEA-LU). Although not within the time frame for
this study, FTA announced in the December 2006 Unified Agenda that it will
undertake a review of its regulations to bring them into conformity with
the SAFETEA-LU statute.
In addition to these more formal regulatory review efforts, DOT officials
reported that the department also reviews its existing regulations at its
own discretion as a function of its daily, ongoing activities. According
to officials, such reviews are often the result of petitions from or
consultations with parties affected by DOT regulations or based on the
experience of agency staff members in light of changes in specific
industries, technologies, or underlying standards. DOT officials said
that, for some of their agencies, reviewing petitions for rulemaking or
regulatory waivers is the most productive way to obtain public input on a
review of that rule. An evaluation of NHTSA's entries in DOT's December
2005 Unified Agenda indicated 10 rule change proceedings in various stages
of completion which were the result of petitions from regulatory
stakeholders. NHTSA also reported that, since 2001, it has conducted 17
reviews of Federal Motor Vehicle Safety Standards (FMVSS), including a few
studies evaluating the benefits and costs of various standards. PHMSA
reported that the granting of numerous waivers of a regulation is a
particular signal that new technology or conditions may render that
regulation obsolete or in need of amendment.
263 Fed. Reg. 31,883 (June 10, 1998). The Executive Memorandum directed
agencies to consider rewriting existing rules in plain language when the
opportunity and resources permit.
Table 7: Description of DOT Retrospective Reviews
Mandatory reviews Discretionary reviews
Review o Section 610 o Responses to petitions,
authorities o Executive Order 12866 requests for
interpretations
o Responses to changes in
specific industries,
technologies, or
underlying standards
Frequency o DOT has a formal o As needed, as a
program for reviewing all function of daily
of its regulations over a activities
10-year cycle. Every o As determined by the
year, DOT reviews some of office initiating the
its sections of the CFR review, under DOT
in that 10-year effort. departmentwide policy to
periodically review
existing regulations
Purposes o Reduce burden on small o Meet complaints or
entities suggestions of public
o Reduce complexity of o Simplify or clarify
regulation language, particularly in
o Consolidate duplicative response to petition,
rules problems evidenced in the
o Respond to changes over enforcement of the
time in technology, regulation;
economic conditions o Eliminate overlapping,
duplicative regulations;
o Eliminate conflicts and
inconsistencies in its
own regulations or those
of other initiating
offices or other
agencies;
o Insure continued
relevance of the problem
the regulations were
originally intended to
solve;
o Address changes in
technology, economic
conditions, or other
factors; and
o Monitor rules receiving
a number of requests for
exemption from a
regulation.
General outcomes o According to DOT review o 43 of the 61 DOT rules
summary reports, 102 of nominated in the OMB
the 406 reviews conducted reform initiatives
between 2001 and 2006 resulted in subsequent
resulted in further actions.
action, such as making o According to NHTSA
substantive or plain officials, the majority
language amendments as of NHTSA reviews do not
well as identifying result in changes to
regulations for further regulations because they
study. confirmed that the
o DOT reported 5 regulations were
rulemakings resulting effective.
from Section 610 reviews. o According to FAA
o FAA reported that none officials, no changes
of the agency's Section have been promulgated or
610 reviews have resulted proposed for reviews
in any changes to the conducted in response to
regulations. the Federal Aviation
Reauthorization Act of
1996.
o DOT received and
responded to 120 public
comments based on 2005
stand-alone review
process. DOT identified
36 comments as warranting
further action and 21 as
warranting further
consideration.
Agency views on o DOT officials characterized regulatory reviews as
usefulness of generally valuable because they ensure the agency
reviews focuses on whether the rule is meeting its objectives,
whether changed circumstances warrant revisions or
revocation, or whether the rule is as cost effective
as originally thought.
o DOT officials reported that when formal reviews do
not result in changes, it may be because changes were
already made as a result of informal or discretionary
reviews.a
Source: GAO analysis of agency data and regulatory statutes.
aInformal reviews generally refer to those conducted as a routine
occurrence during daily general operations of an agency, when problems are
identified with existing rules that might warrant further action. See
Eisner and Kaleta at page 7.
DOT Retrospective Review Process
DOT has written policies and procedures guiding the planning, conduct, and
reporting of reviews. While the processes employed by DOT agencies may
vary somewhat, overall these agencies follow DOT guidelines in the conduct
of their reviews. For example, DOT's Policies and Procedures provide
guidance for prioritizing regulations for review, including the extent of
complaints or suggestions received from the public; the degree to which
technology or economic factors have changed; and the length of time since
the regulations were last reviewed, among other factors.3 DOT's procedures
also provide agencies with discretion in applying the procedures. For
example, NHTSA reported that it gives highest priority to the regulations
with the highest costs, potential benefits, and public interest, while
PHMSA reported that it gives highest priority to initiatives it deems most
likely to reduce risk and improve safety. Additionally, while DOT
officials reported that DOT considers OMB Circular A-4 on "Regulatory
Analysis" as a guide for cost/benefit analysis of regulatory outcomes, FAA
reported that it uses a set of flexible procedures recommended by an
outside consultant to conduct ex post evaluations of some rules. With
regard to public participation in the review process, Appendix D to the
department's Unified Agenda announces the complete schedule for all
reviews, requests public comments for reviews in progress, and reports the
results of completed reviews and their results. DOT agencies also pointed
out that they regularly interact with stakeholders, such as regulated
industries, consumers, and other interested parties to obtain feedback on
regulations. For example, FAA officials stated that the agency holds
conferences with industry and consumer groups to identify regulatory
issues for review. In terms of the reporting of review results, DOT
publishes brief summaries of completed reviews in Appendix D of its
Unified Agenda. However, agencies may report review results in other ways.
For example, FMCSA documents the results of its Section 610 reviews in an
annual internal report, while NHTSA publishes the technical reports of its
reviews in the Federal Register, requesting public comments on its
determinations. Figure 9 depicts DOT's general process for regulatory
review.
344 Fed. Reg. 11,033 (Feb. 26, 1979).
Figure 9: Illustration of DOT's Review Programa
aThis flow chart presents a summary of what DOT describes as its formal
review process, which includes reviews conducted in its 10-year review
plan. This illustration may not convey the actual process used in a given
situation, which may vary to accommodate complexities not included in this
depiction.
Appendix VI: Consumer Product Safety Commission Retrospective Reviews
Since 2001, the Consumer Product Safety Commission (CPSC or the
Commission) systematically reviewed its regulations under its own
discretion, but has not conducted any mandatory reviews because none of
its rules triggered Section 610 or other mandatory review requirements.
Moreover, agency officials noted that because of its reliance on voluntary
consensus standards, the agency does not promulgate as many rules as other
regulatory agencies. However, the primary purpose of CPSC discretionary
reviews is to assess whether the regulations that CPSC promulgates remain
consistent with the objectives of the Commission. In performing its
reviews, CPSC has created systematic processes for the planning, conduct,
and reporting of its reviews. Through this process, the Commission
prospectively budgets for its reviews. Because CPSC's review program is so
new, the agency has not completed most of the reviews that it has
initiated, but the Commission has proposed changes to at least two
existing regulations. In addition, the officials reported that their
review program has been useful to the Commission.
CPSC Retrospective Review Activity
CPSC actively conducted reviews of its existing regulations under its own
discretion. Specifically, the Commission implemented a pilot review
program in 2004, with annual follow-up efforts in 2005 and 2006, which
resulted in the initiation of 14 retrospective reviews. CPSC initiated
this review process partly because of an Office of Management and Budget
(OMB) Program Assessment Rating Tool (PART) recommendation that the agency
develop a plan to systematically review its current regulations to ensure
consistency among them in accomplishing program goals. The primary purpose
of CPSC reviews is to assess the degree to which the regulations under
review remain consistent with the Commission's program policies and
program goals. CPSC also assesses whether it can streamline regulations to
minimize regulatory burdens, especially on small entities. The officials
reported that their review process is so new that they have not yet fully
completed it for all of the reviews that they have initiated. However,
they have completed at least 3 of their 14 initiated reviews.
Officials reported that, while some of the regulations they reviewed did
not need a revision, they have proposed regulatory changes for two
regulations, including standards for flammability of clothing textiles and
surface flammability of carpets and rugs. They reported that their reviews
could focus on opportunities to either expand or streamline existing
regulations. Thus, their reviews could lead to increases or decreases in
the scope of CPSC regulations. As examples, CPSC officials reported that
during their review of their existing bicycle regulation they identified
that the regulation did not reflect new technology and materials, and
therefore needed to be modified and updated. Conversely, their review of
their cigarette lighter rule revealed that the agency needed to promote
greater compliance and more effective enforcement, which increased the
agency's regulatory oversight. Table 8 provides additional detail on the
CPSC retrospective reviews.
Table 8: Description of CPSC Retrospective Reviews
Discretionary reviews
Review authorities o Agency-initiated reviews conducted under the
agency's formal regulatory review program, in
response to OMB PART recommendation
o Technology changes, petitions, test lab input,
new industry standards, obsolescence of test
equipment
Frequency o Under new program review about 4 regulations
per year
o Other discretionary reviews conducted as needed
Purposes o Effectiveness in meeting agency goals (such as
performance measurement)
o Burden reduction
General outcomes o Process new, but completed reviews have led to
subsequent regulatory action (e.g., proposed
changes to regulations)
Agency views on o Officials reported that reviews are generally
usefulness of reviews useful to identifying and responding to needed
regulatory changes, confirming that some rules
are producing intended results and improving
enforcement. However, review of regulations not
as prominent for CPSC because of reliance on
voluntary standards.
Source: GAO analysis of agency data and regulatory statutes.
CPSC Review Process
CPSC established a formal review program that prospectively budgets for
the substantive reviews that the agency will conduct. Officials reported
that they have conducted about four substantive reviews per year using
this process, while still managing other agency priorities. The process
consists of three phases, including: (1) prioritization and selection of
regulations to substantively review, (2) substantive review of the
selected regulations, and (3) reporting results to the Commissioners and
the public, for certain reviews. As part of this process, CPSC staff
prioritize which regulations need review by considering: (1) which rules
have the oldest effective dates, (2) which rules were adopted under
various statutes under CPSC's authority, and (3) which rules staff
identified as good candidates for change (from their experience working
with the regulation). As resources allow, the agency selects one
substantive regulation from each of their statutes' areas (with the
exception of the Refrigerator Safety Act), starting with their earliest
regulations.1 As part of this prioritization process, the agency considers
input from CPSC's technical staff and outside groups. CPSC staff initiates
substantive review of regulations that the Commission chooses for review.
In this process, the agency solicits public comments using the Federal
Register, assesses the comments received, conducts an internal technical
review of the regulation, and reports the results to the Commissioners.
The Commissioners make a policy decision on actions the agency will take
based upon staff recommendations. If the agency decides to conduct a
follow-on activity to update a rule, it subsequently notifies the public
via the Federal Register. For rule reviews that result in
Commission-approved projects for certain rulemaking activities (such as
developing revisions to a rule for Commission consideration), CPSC makes
the briefing packages available on its Web site. Other rule reviews (such
as reviews for which staff suggests no action) are given to the
Commissioners, but are not posted on the Web site. Figure 10 illustrates
the general review process.
1CPSC officials reported that their review process typically involves a
modest amount of staff resources per year (less than 10 staff months), and
involves work by staff who specialize in a variety of consumer product
hazard categories. They pointed out that the costs of their review program
are built into CPSC's operating plan and budget justification. Each
portion of the plan and activities must be accounted for in this budget
plan. If resources or agency priorities do not permit commitment of
resources to revise regulations that CPSC staff identified for revision,
CPSC officials may forego initiating a Phase 2 update until a later date.
Figure 10: CPSC Retrospective Review Process
Appendix VII: Environmental Protection Agency Retrospective Reviews
During the 2001 through 2006 period covered in our review, program offices
within Environmental Protection Agency (EPA) have conducted numerous
retrospective reviews of EPA existing regulations and standards. The mix
of reviews conducted by EPA--in terms of authorities--varied across the
agency, but the purposes of these reviews--effectiveness, efficiency, and
burden reduction--were similar across the agency. EPA's retrospective
review results provided three distinctive outcomes. While the agency
conducts many reviews under its mandates, reviews conducted on its own
discretion yielded more changes to existing regulations than mandated
reviews. The review processes within EPA's program offices, though
different, typically shared similar elements in the planning, conduct, and
reporting of results. Overall, EPA reported that its retrospective reviews
have proven to be useful to the agency.
EPA Retrospective Review Activities
The Office of Air and Radiation (OAR), the Office of Prevention,
Pesticides, and Toxic Substance (OPPTS), the Office of Solid Waste and
Emergency Response (OSWER), and the Office of Water within EPA each
conduct mandatory retrospective reviews under their guiding statutes and
focus the reviews on what is stated in statute or developed by the agency.
Thus, the frequency of mandated reviews varies within EPA as well as the
program offices. For instance, the frequency of reviews required by the
Safe Drinking Water Act (SDWA), conducted by the Office of Water, ranges
from every 3 years to every 7 years, depending on the review requirement,
while the OAR is required to conduct reviews by the Clean Air Act ranging
from every 3 years to every 8 years. Mandated reviews, such as those
required by agency-specific statutes, mainly focused on effectiveness,
while Section 610 reviews and Office of Management and Budget (OMB)
Regulatory Reform Nominations were focused on burden reduction. According
to EPA officials, mandatory retrospective reviews have generally resulted
in limited or no changes to regulations, while reviews conducted under
discretionary authority usually resulted in more changes.1 For instance,
of the 14 Section 610 reviews conducted by the program offices since 2001,
only 1 resulted in change.2 Moreover, OAR noted that most of its reviews
validated the need for the regulation or standard. However, EPA's review
of regulations in response to OMB's Manufacturing Regulatory Reform
initiative resulted in 19 regulatory changes and 19 nonregulatory actions,
including the development of regulatory guidance and reports. In addition,
GAO's review of EPA's December 2006 Unified Agenda entries also revealed
that 63 out of 64 rules identified as changed or proposed for changes were
the result of decisions made under EPA's discretionary authority. Though
the use of discretionary authority produced more rules changes, officials
reported that retrospective reviews, in general, were valuable in (1)
determining whether new information exists which indicates the need for
revisions and (2) enabling the agency to gain new insights about its
analytical methods. In addition, officials noted that retrospective
reviews were useful in determining whether the rule was working as
intended and helping to achieve the agency's or statute's goals.
1The Office of Prevention, Pesticides and Toxic Substances and the Office
of Solid Waste and Emergency Response reported that their reviews in
response to the OMB Manufacturing Regulatory Reform initiative all
resulted in the changes.
2OPPTS reported two changes as a result of its Section 610 reviews;
however, one change may have been conducted prior to years included within
the scope of our review.
Table 9: Description of EPA Retrospective Reviews
Mandatory reviews Discretionary reviews
Review In response to: In response to:
Authorities
o Clean Air Act o OMB's Manufacturing
o Clean Water Act Regulatory Reform
o Federal Food, Drug, Nominations
&Cosmetic Act o Formal petitions
o Federal Insecticide, o Industry changes
Fungicide, and Rodenticide o New scientific
Act studies
o Comprehensive o Informal comments
Environmental Response, from the public
Compensations and Liability o Emergencies or
Act disasters
o Food Quality Act
o Safe Drinking Water Act
o Section 610 of the
Regulatory Flexibility Act
o Court decisions
Frequency Ranges from every 2 years to Depends largely on the
every 10 years depending on the nature of the source
review requirement
Purposes Effectiveness, burden Depends largely on the
reduction, and efficiency nature of the source
General outcomes Reviews generally resulted in Reviews generally
no changes, a validation that resulted in changes,
existing regulations are particularly in response
working. Sometimes reviews to OMB nominations.
resulted in the development of
guidance materials in lieu of a
rule modification.
Agency views on Officials reported that the Officials did not
usefulness of frequency of some mandated differentiate between the
reviews reviews limits the usefulness usefulness of
of the reviews. However, discretionary reviews
reviews were useful to versus mandatory reviews.
determine whether the
regulations were working as
intended.
Source: GAO analysis of agency data and regulatory statutes.
EPA Review Process
EPA's review process varied by program office and by review requirement;
however, most mandatory and discretionary reviews contained consistent
elements. The four EPA program offices included in our review perform
various functions of the agency that rarely overlap into other program
offices duties. For example, OAR exclusively oversees the air and
radiation protection activities of the agency, while the Office of Water
solely manages the agency's water quality activities. These two offices
have different guiding statutes that require them to conduct reviews and,
within those statutes, processes are sometimes outlined for how the agency
should conduct the reviews. Therefore, the processes for these program
offices varied. However, three elements were similar across the offices:
these included formal or informal notification of the public; involvement
of the public in the conduct of the review mainly through the request of
public comments, science, risk, or policy assessments of the regulation;
and release of the results to the public primarily through the Federal
Register and the EPA Web site. In addition, mandatory and discretionary
regulatory reviews that were high profile in nature (e.g., because they
were conducted in response to emergencies, were contentious, or received
heavy attention from the public, Congress, or regulatory experts) had the
aforementioned elements as well as high-level management attention from
the Assistant Administrator of the program office or the EPA
Administrator. For example, the review processes of the mandatory National
Ambient Air Quality Standards and the Lead and Copper review, which was
initiated after elevated levels of lead were found in the District of
Columbia, were defined, documented, and included extensive public
involvement and high-level management attention. Figure 11 illustrates the
general review process for the different review drivers.
Figure 11: EPA Retrospective Review Process
Appendix VIII: Federal Communications Commission Retrospective Reviews
The Federal Communications Commission (FCC or the Commission) actively
reviews its existing regulations to meet congressionally mandated review
requirements, and to respond to petitions from regulated entities and
changes in technology and market conditions, under its own discretionary
authority. While FCC's retrospective review processes vary depending on
the review requirement the agency is addressing, FCC's biennial and
quadrennial review processes provide opportunities for public
participation and transparency. According to FCC officials, the frequency
of the biennial review requirement presents staffing challenges to the
agency, while the 10-year requirement for the Section 610 review presents
a challenge to the usefulness of this review, as regulations may have been
previously modified under other requirements prior to the review.
FCC Retrospective Review Activity
FCC actively reviews its existing regulations to meet congressionally
mandated review requirements and to respond to petitions from regulated
entities and changes in technology and market conditions under its own
discretionary authority. Under the Communications Act, as amended, the
Commission is subject to two agency-specific mandated reviews: (1) the
biennial regulatory review of FCC telecommunications rules,1 and (2) the
quadrennial regulatory review of the broadcast and media ownership rules.2
FCC officials reported that these reviews are guided by the deregulatory
tenor of the Telecommunications Act, which instructed the Commission to
promote competition and reduce regulation in the telecommunications and
broadcast industries. The purpose of these reviews is to identify rules no
longer necessary in the public interest so that they may be modified or
repealed. In the 2002 biennial review, the Commission conducted and
reported 89 separate review analyses of its telecommunications regulations
and made more than 35 recommendations to open proceedings to consider
modifying or eliminating rules. The Commission is also subject to the
governmentwide review requirement to minimize significant economic impact
on small entities under Section 610. FCC has initiated 3 multiyear Section
610 review projects (1999, 2002, 2005), plus 1 single-year review (2006),
issuing public notices listing all rules subject to Section 610 review.
Officials pointed out that these reviews rarely result in rulemaking
proceedings and cited only one proceeding which resulted in the
elimination of obsolete rules as a result of the Section 610 process.3
1 The biennial review is conducted under Section 11 of the Communications
Act, as amended by Section 402 of the Telecommunications Act of 1996,
which created the requirement for the biennial review.
2 Section 202(h) of the Communications Act required a biennial review of
broadcast ownership rules. Congress, through the Consolidated
Appropriations Act of 2004, changed this review requirement to every 4
years (it is now referred to as the quadrennial review).
In addition to these mandatory requirements, FCC officials reported that
the Commission reviews existing regulations at its own discretion in
response to rapid changes in technology and market conditions and to
petitions from regulated entities. A GAO analysis of the December 2006
Unified Agenda indicated that most of FCC's proposed and final rule
changes for that year were the result of decisions made under FCC's
discretionary authority. Of the 39 rule changes listed in the Unified
Agenda, 33 were the result of decisions made at the Commission's own
discretion, while 6 of those changes were the results of mandated actions.
This informal analysis indicates that, in addition to its mandatory review
requirements, FCC does make efforts to review and amend regulations under
its own discretion.
Table 10: Description of FCC Retrospective Reviews
Mandatory reviews Discretionary reviews
Review o Section 610 o Agency discretion
authorities o Section 11 of
Communications Act
o Section 202(h) of
Telecommunications Act
Frequency o 10 years (Section 610) o As needed, based on
o 2 years (Section 11) industry developments,
o 4 years (Section 202(h)) issues of interest to
the general public
Purposes Section 610 Review: o Respond to petitions
for reconsideration,
o Reduce burden on small rulemaking, waiver, or
entities forbearance
o Reduce complexity of o Changes in technology
regulation or economic conditions
o Consolidate duplicative in regulated sectors
rules o Respond to
o Respond to changes over interactions with
time in technology, regulated entities,
economic conditions general public
Biennial review (Section 11):
o Repeal or modify
telecommunications rules
that are no longer
necessary in the public
interest as a result of
meaningful economic
competition
Quadrennial review (Section
202(h)):
o Repeal or modify
broadcast ownership rules
determined to be no longer
in the public interest
General outcomes Section 610 Review: o Officials stated that
the outcomes of reviews
o FCC reported that most varied based upon the
reviews result in no regulation reviewed,
changes, and cited only one purpose of the review,
proceeding which resulted and impetus of the
in the elimination of review.
rules.
Biennial review:
o Most biennial reviews
result in some changes to
the Commission's
regulations, either to
modify or remove rules that
are no longer necessary.
Quadrennial review:
o The 2002 review order
would have relaxed most
rules under review.4
Agency views on o Officials reported that o Officials reported
usefulness of review requirements enable that discretionary
reviews FCC to conduct reviews enable FCC to
notice-and-comment reviews prioritize reviews and
of existing regulations provide timely response
more often than it might to industry
otherwise. developments.
Source: GAO analysis of agency data and regulatory statutes.
3See FCC 06-129, In the Matter of Amendment of Part 13 and 80 of the
Commission's Rules, PR Docket No. 92-257, Memorandum Opinion and Order,
2006.
FCC Review Process
FCC's retrospective review processes vary somewhat depending on the review
requirement the agency is addressing. However, in its conduct of the
biennial and quadrennial review, FCC follows a notice-and-comment review
process which provides opportunities for public participation and
transparency. For example, in the 2002 biennial review, FCC Bureaus and
Offices issued public notices listing rules for review under their purview
and requesting comments regarding the continued necessity of rule parts
under review. The Bureaus and Offices published Staff Reports on the FCC
Web site summarizing public comments and making determinations as to
whether the Commission should open proceedings to modify or eliminate any
of the reviewed rules. The Commission released Notices of Proposed
Rulemaking, seeking further public comments. Officials reported that if
the Commission modifies or eliminates any regulations as a result of its
proceeding, that decision is announced in a rulemaking order, which is
published in the Federal Register. Similarly, in the 2006 quadrennial
review (which was in process at the time this report was written) the
Commission released a Further Notice of Proposed Rulemaking (FNPR) and
posted a Web page providing background information and hyperlinks to FCC
documents relevant to the review. The FNPR requests public comment on the
media ownership rules and factual data about their impact on competition,
localism, and diversity. The Commission reported that it will hold six
public hearings in locations around the country and make available for
public comment 10 economic studies commissioned by FCC on issues related
to the media ownership rules.
4The rule changes from the 2002 quadrennial review never went into effect.
In 2004, the U.S. Court of Appeals remanded back to FCC for further review
its rules for cross-media ownership, local television multiple ownership,
and local radio multiple ownership (Prometheus Radio vs. F.C.C., 373 F.3d
372 (3rd Cir. 2004)). Additionally, Congress overturned FCC's national
television ownership rule which would have allowed a broadcast network to
own and operate local broadcast stations reaching 45 percent of U.S.
television households. Through the Consolidated Appropriations Act of
2004, Congress set the national television ownership limit at 39 percent
(Pub. L. No. 108-199, 118 Stat. 3, 100 (Jan. 23, 2004)).
Despite the opportunities for public participation in these regulatory
reviews, the mandated structure of some review processes presents a
challenge to the usefulness of FCC reviews. For example, according to an
FCC official, the requirement to review the Commission's
telecommunications rules every 2 years forces Bureau staff to be
constantly reviewing regulations. This official reported that the
quadrennial requirement is a more appropriate time period for review, as
it provides greater opportunity for regulatory changes to take hold.
Additionally, an official reported that too much time between reviews can
be problematic. For example, rules that require Section 610 review every
10 years may have been modified or previously reviewed as part of an
overlapping review requirement or as part of a discretionary review
occurring prior to the 10-year review requirement.
Figure 12: FCC Retrospective Review Processes
Appendix IX: Federal Deposit Insurance Corporation Retrospective Reviews
During the 2001 through 2006 period covered in our review, the Federal
Deposit Insurance Corporation (FDIC), has performed numerous retrospective
reviews of its existing regulations in response to mandatory authorities
such as Section 610 of the Regulatory Flexibility Act and the Economic
Growth Regulatory and Paperwork Reduction Act of 1996 (EGRPRA) and at its
own discretion. The focus of FDIC's reviews has been on burden reduction,
which is part of the agency's strategic goals. The process that FDIC used
to plan, conduct, and report its reviews was coordinated by a larger
organizational body. The centralized review effort helped to leverage the
agencies' resources and facilitate the regulatory changes recommended as a
result of the EGRPRA reviews.
FDIC Retrospective Reviews
FDIC, along with members of the Federal Financial Institutions Examination
Council (FFIEC) has examined 131 regulations under EGRPRA.1 FDIC conducted
two Section 610 reviews after 2001, but before the initiation of the
EGRPRA reviews in 2003. Because the EGRPRA review affected almost all of
FDIC's regulations, the agency subsequently included Section 610 reviews
within the EGRPRA review effort. Also, the agency has conducted
discretionary reviews in response to petitions and external emergencies,
such as natural disasters. For instance, the agency reported reviewing its
regulations to reduce burden for businesses affected by Hurricane Katrina.
In doing so, the agency made 8 temporary regulatory changes to ease the
burden on affected entities. FDIC also made changes to 4 regulatory areas,
which included changes to 3 regulations, as a result of the EGRPRA
reviews. Additionally, GAO's review of the December 2006 Unified Agenda,
indicated FDIC made changes to 5 regulations as a result of decisions
under its own discretion and 4 changes as result of mandates. FDIC and the
other banking agencies also worked with Congressional staff regarding
legislative action as a result of the EGRPRA reviews. For example, the
agencies reviewed over 180 legislative initiatives for burden relief in
2005. Furthermore, the agencies testified before the
1As previously mentioned in the report, the FFIEC is a formal interagency
body empowered to prescribe uniform principles, standards, and report
forms for the federal examination of financial institutions by FDIC, the
Board of Governors of the Federal Reserve System, the National Credit
Union Administration, the Office of the Comptroller of the Currency, the
Office of Thrift Supervision and the State Liaison Committee, and to make
recommendations to promote uniformity in the supervision of financial
institutions.
Senate Banking Committee and House Financial Services Committee on a
variety of burden reduction measures and upon request, agency
representatives offered technical assistance in connection with the
development of legislation to reduce burden. Congress later passed and the
President signed the Financial Services Regulatory Relief Act of 2006 on
October 13, 2006.
Table 11: Description of FDIC Retrospective Reviews
Mandatory reviews Discretionary reviews
Review o EGRPRA o Formal petitions
authorities o Section 610 o Emergencies or
disasters
Frequency o Every 10 years for both o Depends largely on
EGRPRA and Section 610 after the nature of the
adoption source
Purposes o Both acts focus on reducing o Depends largely on
burden the nature of the
source
General outcomes o Reviews generally resulted o Reviews generally
in changes and resulted in changes
recommendations for
legislative action
Agency views on o Officials reported that o Officials did not
usefulness of these reviews help the agency differentiate between
reviews to accomplish its goals to the usefulness of
reduce burden while also discretionary reviews
being valuable because there versus mandatory
is a need for regulatory reviews.
decisions to reflect current
realties.
Source: GAO analysis of agency data and regulatory statutes.
FDIC Retrospective Review Process
FDIC and other financial regulatory agencies that are members of the FFIEC
decided to use the FFIEC as the coordinating body for the EGRPRA review
process because the act affected all of the agencies and the agencies
wanted to: (1) establish a centralized process for selecting, conducting,
and reporting its reviews; and (2) leverage the expertise and resources of
all of the member agencies. EGRPRA required the agencies to categorize
their rules, solicit public comment, and publish the comments in the
Federal Register. The act also required the agencies to report to Congress
no later than 30 days after publishing the final summarized comments in
the Federal Register. The FFIEC established additional processes for
planning, conducting, and reporting of retrospective reviews conducted
under EGRPRA outside of these specified requirements, such as providing 90
public comment periods, holding outreach meetings with regulated entities
as well as consumer groups across the United States, and establishing a
Web site dedicated to the EGRPRA reviews. Within all of the processes
developed by the FFIEC, a high level of management attention was
maintained. For instance, the Director of the Office of Thrift Savings,
who is also a member of FDIC's Board of Directors, headed the interagency
effort. In this capacity, a political appointee was involved in planning,
conducting, and reporting the reviews. As illustrated by figure 13, the
process involved interagency coordination and review activities within
each individual agency, including FDIC.
Figure 13: FDIC Retrospective Review Process
Appendix X: Small Business Administration Retrospective Reviews
During the 2001 through 2006 period covered in our review, the Small
Business Administration (SBA) has reviewed its existing regulations in
accordance with Section 610 of the Regulatory Flexibility Act and on it
own discretion. While the purpose of the Section 610 reviews was to reduce
burden, the purpose of every discretionary review was to increase
effectiveness. SBA had written procedures to plan, conduct, and report its
Section 610 reviews. However, the agency did not have written processes to
guide planning, conduct, and reporting of discretionary reviews. Overall,
SBA's discretionary reviews have resulted more often in regulatory changes
than reviews mandated by statute.
SBA Retrospective Review Activities
Officials reported that SBA has conducted discretionary reviews based on
congressional interest or industry petitions. Specifically, officials from
the HUBZONE program indicated that their office receives attention from
congress about the workings of their regulations, thereby prompting them
to review their existing regulations. In addition, SBA's Division of Size
Standards completed 27 reviews in response to industry petitions and
congressional requests. SBA also completed 4 Section 610 reviews in 2005.
While the purpose of the Section 610 reviews was to reduce burden,
officials from one division in SBA said that they focused many of their
retrospective reviews on examining the effectiveness of their regulations
by evaluating their progress on outcomes. However, they stated that
because some of their regulations are linked to the regulatory activity of
other agencies, they are not always able to achieve the intended outcome
of the regulation. Of the reviews conducted by SBA, discretionary reviews
yielded more changes to existing regulations than mandated reviews. For
instance, there were no changes made to the 4 Section 610 reviews
completed but there were 23 final or proposed changes to regulations in
response to industry petitions. In addition, GAO's examination of SBA's
December 2006 Unified Agenda entries indicated that 22 rule changes were
the result of the agency's discretionary authority rather than statutory
mandates.
Table 12: Description of SBA Retrospective Reviews
Mandatory reviews Discretionary reviews
Review o Section 610 o Formal petitions
authorities o Congressional
interest
Frequency o Every 10 years o Depends largely on
the nature of the
source
Purposes o Burden reduction o Effectiveness
General outcomes o Reviews generally resulted o SBA made changes to
of reviews in limited or no changes. 23 out of 27
According to the December regulations resulting
2006 Unified Agenda, SBA made from petitions.
changes to two regulations as
a result of an
agency-specific mandate.
Agency views on o Officials stated that o Officials did not
usefulness of retrospective reviews are differentiate between
reviews useful because they provide the usefulness of
an opportunity for the public discretionary reviews
and the agency to revisit versus mandatory
rules to ensure continued reviews.
effectiveness and achievement
of goals and objectives.
Source: GAO analysis of agency data and regulatory statutes.
SBA Retrospective Review Process
SBA's Section 610 Plan in the May 2006 Unified Agenda described procedures
for conducting Section 610 reviews. The plan specifies that SBA will
consider the factors identified in Section 610. The plans also specifies
that the conduct of the review will be performed by the program office of
jurisdiction, which entails reviewing any comments received from the
public, in consultation with the Office of General Counsel (OGC) and the
Office of Advocacy. The document notes that the program office may contact
associations that represent affected small entities in order to obtain
information on impacts of the rules. Although Section 610 does not require
agencies to report the results of the reviews, SBA reported its results in
the Unified Agenda.
Under SBA's standard operating procedures each program office is
responsible for evaluating the adequacy and sufficiency of existing
regulations that fall within its assigned responsibilities. However,
according to the officials, the agency does not have a uniform way to
plan, conduct, and report these discretionary reviews. In general, the
agency conducts reviews in an informal manner; therefore, documentation
does not exist for the procedures or standards used to conduct these
reviews. However, officials described considering these factors to
prioritize their reviews: (1) the level of congressional interest in a
specific review, (2) OGC's input on which rules should be reviewed, and
(3) the number of petitions and appeals SBA has received regarding a
particular rule. Reviews are conducted differently in the various program
offices within SBA. Moreover, the agency described a high turnover of
employees, which makes it important to document SBA reviews and processes.
Currently, it does not appear that the agency documents its review and
processes.
Figure 14: SBA's General Retrospective Review Process
Appendix XI: Department of Labor's Employee Benefit Security
Administration: Example of a Documented Formal Review
Employee Benefit Security Administration's (EBSA) retrospective regulatory
review process was the most documented and detailed formal review process
included in our review. According to EBSA officials and our review of EBSA
documentation on its Regulatory Review Program (the Program), the agency
established its program as a continuing and systematic process that allows
the agency to periodically reviews its regulations to determine whether
they need to be modified or updated. The Program takes into account
technology, industry, economic, compliance and other factors that may
adversely affect a rule's continued usefulness, viewed with respect to
either costs or benefits. According to program documentation, through the
integration of prescribed review criteria, regulatory reviews conducted
under the Program would also help EBSA to satisfy the Section 610
requirement for periodic reviews of agency regulations. In addition, the
Program provides information and data that assists EBSA in conducting
regulatory reviews of EBSA regulations in accordance with the requirements
of Executive Order 12866.
EBSA's regulatory review process is conducted annually by a Regulatory
Review Committee (RRC) composed of the Counsel for Regulation, Office of
the Solicitor's Plan Benefits and Security Division (or his delegate), and
the Directors of the following offices (or their respective delegates):
Office of Regulations and Interpretations, Office of Policy and Research,
Office of Enforcement, Office of Health Plan Standards and Compliance
Assistance, and Office of Exemption Determinations. The Director of
Regulations and Interpretations (or his delegate) chairs the RRC. EBSA's
review process consists of three formal phases: (1) selection of
regulations for further review, (2) substantive review of the selected
regulations, and (3) reporting review results to high-level management and
the public.
During phase 1 of EBSA's review process, the selection and recommendation
of regulations for substantive review, the RRC conducts a preliminary
review of EBSA's regulations and assigns a value for the need for
additional review on a scale of 1 (lowest value) to 5 (highest value),
based upon several factors (listed below). This ranking is based on the
RRC's "expert" judgment and knowledge of the regulated community. For
purposes of this type of review, the RRC may consider a series of closely
related regulations as one regulation. The RRC subsequently compiles the
results of the review in chart or outline form in order to compare the
regulations and recommends to the Assistant Secretary at least three
regulations as candidates for review under the Program. At least one of
the three regulations recommended is subject to review under Section 610.
The RRC presents its recommendations for regulations that need further
review in a written report to the Assistant Secretary, including an
explanation of the reasons for its recommendations. The factors that the
RRC considers when preliminarily reviewing the regulations are:
o whether the regulation is subject to review under the RFA;
o whether the regulation is subject to review under statutory or
Executive Order requirements other than the RFA;
o absolute age of regulation (time elapsed since promulgation);
o time elapsed since regulation was last amended and nature of
amendment (major/minor);
o court opinions adjudicating issues arising under regulation;
o number of EBSA investigations that have found violations of
regulation;
o number of public requests received for interpretation of
regulation;
o type(s) of plans affected by the regulation;
o number of plans affected;
o cumulative number of participants and beneficiaries affected by
regulation;
o cumulative amount of plan assets affected by regulation;
o relative difficulty of compliance with regulation for the
regulated entities (complexity, understandability);
o potential for cost burden as compared with intended benefits of
the regulation;
o extent to which development of new technology or industry
practice since promulgation may reduce effectiveness of
regulation;
o extent to which legal changes (statutory, regulatory, executive
order) since promulgation of the regulation may affect its
validity;
o significance of the regulation with respect to EBSA's goals;
o significance of the regulation with respect to enforcement,
compliance assistance and voluntary compliance efforts; and
o availability of information pertinent to evaluating the
regulation.
EBSA's review program also outlines detailed criteria for the
selection of regulations to review under Section 610. The program
sets a clear definition of what constitutes a "significant impact
on a substantial number of small entities" for its regulations, a
step which, as we have noted in the past, many agencies have not
yet taken.1 Specifically, the program sets threshold criteria for
what constitutes "significant impact" and "substantial number of
entities." GAO has reported on numerous occasions that the lack of
clarity about these terms is a barrier to agency conduct of
reviews and has resulted in fewer reviews being conducted.
Therefore, this step in the review program appears to be a very
useful factor. Under EBSA's approach for measuring these
thresholds, the rules to be reviewed each year are first subjected
to quantitative analysis to determine whether they are considered
to have a significant economic impact on a substantial number of
small entities. For its initial Section 610 reviews, EBSA has
adopted a uniform standard of $25 per plan participant to measure
the discretionary impact of regulations reviewed under Section
610, and whether it constitutes a "significant economic impact."
EBSA's definition of a small entity as an employee pension or
welfare plan with fewer than 100 participants is grounded in
sections 104(a)(2) and (3) of the Employee Retirement Income
Security Act (ERISA),2 which permit the Secretary to prescribe
simplified annual reports for pension and welfare plans with fewer
than 100 participants. Additional details on these definitions and
how they were derived can be found in the agency's Regulatory
Review Program guidance.
During phase two of EBSA's review process, the substantive review
of regulations, the RRC substantively analyzes each regulation
selected by the Assistant Secretary, and considers the following
factors, among others, in determining whether the agency should
amend, rescind, or retain a regulation:
o whether there appears to be a continued need for the regulation;
o whether the regulation has been the subject of complaints or
comments from the public and the nature of those complaints;
o whether the regulation overlaps, duplicates, or conflicts with
other federal statutes or rules or with nonpreempted state or
local statutes or rules;
o whether the regulation is overly complex and could be simplified
without impairing its effectiveness;
o whether the regulation may be based on outdated or superseded
employment, industrial, or economic practices or assumptions and
whether participants and/or beneficiaries of employee benefit
plans may be exposed to harm as a result;
o whether the regulation may impose significant economic costs on
regulated entities and whether the benefit(s) or purpose(s) of the
regulation could be achieved as effectively through an alternative
regulatory approach that would impose less economic burden on
regulated industries;
o whether an alternative regulatory approach that does not
increase the compliance burden for regulated industries could
better serve the purpose(s) of the regulation or provide better
protection(s) to participants and beneficiaries of employee
benefit plans; and
o whether it would be in the public interest to initiate
particular actions (e.g., contracting a research study,
promulgating a Request for Information, conducting a public
hearing) within the authority of EBSA to develop information or
expertise pertinent to the regulation and relevant to
consideration of the above issues.
1EBSA's document "Regulatory Review Program" notes that Congress did not
prescribe specific standards for defining "substantial numbers" or
"significance of impact" to be used in threshold testing for Section 610
purposes. However, the document outlines, in great detail, guidance for
determining whether regulations meet this threshold. The document also
acknowledges that, while the agency considers its threshold standards
appropriate for purposes of RFA Section 610 reviews, the agency is also
considers it advisable to maintain some flexibility as the standard is
applied going forward, should application of the threshold test produce a
result that appears inconsistent with the intent of RFA.
2 The Employee Retirement Income Security Act of 1974 (ERISA) is a federal
law that sets minimum standards for most voluntarily established pension
and health plans in private industry to provide protection for individuals
in these plans. See, e.g., 29 U.S.C. S 1001.
In phase 3 of the review process, reporting review results, the
RRC provides the Assistant Secretary with a report that includes
(1) a summary of the RCC's conclusions concerning its evaluation
of the regulation, based upon the factors described above; and (2)
recommendations to the Assistant Secretary concerning regulatory
actions that could be taken regarding the regulation. According to
Program documentation, the recommendations could include, but are
not limited to, issuing a Request for Information to supplement
EBSA's knowledge concerning the effect of the regulation,
developing a proposal to amend or withdraw a regulation, or
retaining the regulation in its current form. If the RRC
recommends changes to a rule, the agency analyzes this options in
accordance with Executive Order 12866, RFA, or other requirements,
and publishes determined changes for public comment in the Federal
Register, typically as a Notice of Proposed Rulemaking. If the RCC
recommends issuing a Request for Information to supplement EBSA's
knowledge concerning the effect of the regulation, the agency
publishes this Request for Information in the Federal Register,
before it issues a notice for proposed rulemaking.3 (For an
illustration of this process, see fig 7 in app. IV.)
3In the event that the RRC is unable to complete the review of a
regulation before the end of the year following the year in which it is
selected for review, it reports this to the Assistant Secretary in its
next report and provides the reason(s) for the delay and an estimate of
when the RRC expects to complete the review.
Appendix XII: Comments from the Small Business Administration
Office of Advocacy
Appendix XIII: GAO Contact and Acknowledgements
GAO Contact
Mathew J. Scire, Director, Strategic Issues (202) 512-6806,
[email protected].
Acknowledgements
Tim Bober, Assistant Director, and Latesha Love, Analyst-in-Charge,
managed this assignment. Other staff who made key contributions to this
assignment were Matt Barranca, Jason Dorn, Tim Guinane, Andrea Levine,
Shawn Mongin, Bintou Njie, Joe Santiago, Stephanie Shipman, Michael
Volpe, and Greg Wilmoth.
GAO's Mission
The Government Accountability Office, the audit, evaluation, and
investigative arm of Congress exists to support Congress in meeting its
constitutional responsibilities and to help improve the performance and
accountability of the federal government for the American people. GAO
examines the use of public funds; evaluates federal programs and
poland provides analyses, recommendations, and other assistance to
help Congress make informed oversight, policy, and funding
decisions. GAO's commitment to good government is reflected in its
core values of accountability, integrity, and reliability.
[86]www.gao.gov/cgi-bin/getrpt? GAO-07-791 .
To view the full product, including the scope
and methodology, click on the link above.
For more information, contact Mathew J. Scire at (202) 512-6806 or
[email protected].
Highlights of [87]GAO-07-791 , a report to congressional requesters
July 2007
REEXAMINING REGULATIONS
Opportunities Exist to Improve Effectiveness and Transparency of
Retrospective Reviews
Congress and presidents require agencies to review existing regulations to
determine whether they should be retained, amended, or rescinded, among
other things. GAO was asked to report the following for agency reviews:
(1) numbers and types completed from 2001 through 2006; (2) processes and
standards that guided planning, conducting, and reporting; (3) outcomes;
and (4) factors that helped or impeded in conducting and using them. GAO
evaluated the activities of nine agencies covering health, safety,
environmental, financial, and economic regulations and accounting for
almost 60 percent of all final regulations issued within the review
period. GAO also reviewed available documentation, assessed a sample of
completed reviews, and solicited perspectives on the conduct and
usefulness of reviews from agency officials and knowledgeable nonfederal
parties.
[88]What GAO Recommends
GAO recommends that agencies incorporate various elements into their
policies and procedures to improve the effectiveness and transparency of
retrospective regulatory reviews and that they identify opportunities for
Congress to revise and consolidate existing requirements. In commenting on
a draft of this report, SBA's Office of Advocacy agreed with and provided
updated guidance in response to the recommendations. OMB reported having
no comments on the draft. All others provided technical comments.
From 2001 through 2006, the selected agencies completed over 1,300 reviews
of existing regulations. The mix of reviews conducted, in terms of impetus
(mandatory or discretionary) and purpose, varied among agencies. Mandatory
requirements were sometimes the impetus for reviews, but agencies more
often exercised their own discretionary authorities to review regulations.
The main purpose of most reviews was to examine the effectiveness of the
implementation of regulations, but agencies also conducted reviews to
identify ways to reduce regulatory burdens and to validate the original
estimates of benefits and costs.
The processes and standards guiding reviews varied across agencies and the
impetus and phase of the review process. They varied by the extent to
which agencies applied a standards-based approach, incorporated public
participation, and provided complete and transparent documentation. For
example, while almost all agencies had standards for conducting mandatory
reviews, only about half of the agencies had such standards for conducting
discretionary views. The extent of public involvement varied across review
phases, with relatively more in the selection process for discretionary
reviews. Agencies more often documented all phases of mandatory reviews
compared to discretionary reviews.
The outcomes of reviews included amendments to regulations, changes to
guidance and related documents, decisions to conduct additional studies,
and confirmation that existing rules achieved the intended results.
Mandated reviews, in particular, most often resulted in no changes.
Agencies noted that discretionary reviews generated additional action more
often than mandatory reviews. Agencies and nonfederal parties generally
considered all of the various review outcomes useful.
Multiple factors helped or impeded the conduct and usefulness of
retrospective reviews. Agencies identified time and resources as the most
critical barriers, but also cited factors such as data limitations and
overlapping or duplicative review requirements. Nonfederal parties said
that the lack of transparency was a barrier; they were rarely aware of the
agencies' reviews. Both agencies and nonfederal parties identified limited
public participation as a barrier. To help improve the conduct and
usefulness of reviews, agencies and nonfederal parties suggested practices
such as pre-planning to identify data needed to conduct effective reviews,
a prioritization process to address time and resource barriers, high-level
management support, grouping related regulations together when conducting
reviews, and making greater use of diverse communication technologies and
venues to promote public participation.
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