Clean Air Rulemaking: Tracking System Would Help Measure Progress of
Streamlining Initiatives (Letter Report, 03/02/95, GAO/RCED-95-70).
Pursuant to a congressional request, GAO reviewed the Environmental
Protection Agency's (EPA) progress in streamlining its clean air
rulemaking process, focusing on: (1) improvements that might enhance EPA
streamlining activities; and (2) Office of Management and Budget (OMB)
efforts to reduce the time associated with reviewing EPA rules.
GAO found that: (1) in an effort to expedite clean air rulemakings, EPA
eliminated a duplicative step in the internal review process; (2) in
June 1994, EPA grouped rules into three categories and varied the amount
of review needed in each category, allowing over half of EPA clean air
rules to be assigned to a "fast track" category; (3) despite its efforts
to reform the rulemaking process, EPA acknowledges having missed over 60
percent of the statutory deadlines imposed under the Clean Air Act; (4)
EPA has been unable to demonstrate the effectiveness of its streamlining
efforts because it does not have a system for identifying problem areas
in the rulemaking process; and (5) OMB has concentrated its review
efforts on significant clean air rules only, but it is still unknown if
this change has enhanced EPA ability to expedite clean air rules.
--------------------------- Indexing Terms -----------------------------
REPORTNUM: RCED-95-70
TITLE: Clean Air Rulemaking: Tracking System Would Help Measure
Progress of Streamlining Initiatives
DATE: 03/02/95
SUBJECT: Air pollution control
Standards evaluation
Management information systems
Environmental research
Environmental monitoring
Federal regulations
Interagency relations
IDENTIFIER: EPA Management and Accountability Process System
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Cover
================================================================ COVER
Report to Congressional Requesters
March 1995
CLEAN AIR RULEMAKING - TRACKING
SYSTEM WOULD HELP MEASURE PROGRESS
OF STREAMLINING INITIATIVES
GAO/RCED-95-70
Clean Air Rulemaking
Abbreviations
=============================================================== ABBREV
EPA - Environmental Protection Agency
GAO - General Accounting Office
GPO - Government Printing Office
MACT - maximum achievable control technology
MAPS - Management and Accountability Process System
OAR - Office of Air and Radiation
OIRA - Office of Information and Regulatory Affairs
OMB - Office of Management and Budget
SAN - Start Action Notice
SIP - State Implementation Plan
Letter
=============================================================== LETTER
B-259647
March 2, 1995
The Honorable Max S. Baucus
Ranking Minority Member
Committee on Environment
and Public Works
United States Senate
The Honorable Joseph I. Lieberman
United States Senate
The Clean Air Act Amendments of 1990 established ambitious milestones
for protecting and enhancing the quality of the nation's air. A key
step in meeting these milestones--translating the act's statutory
mandates into workable rules and regulations--requires that the
Environmental Protection Agency (EPA) develop and issue rules at an
unprecedented rate. At the time of the act's passage, EPA's
rulemaking process averaged more than 3 years, and some rules took as
many as 9 years to complete. According to EPA, this rulemaking
process needed to be reformed if the agency was to meet the act's
milestones. Consequently, EPA and the Office of Management and
Budget (OMB) initiated changes to reduce the time required to
promulgate clean air rules. Concerned that EPA has continued to miss
statutory deadlines, you asked us to (1) describe EPA's progress in
streamlining the process for developing and issuing clean air rules
and identify improvements that might enhance EPA's streamlining
activities and (2) describe OMB's corresponding efforts to reduce the
time associated with reviewing EPA's rules. (App. I contains
further details on our objectives, scope, and methodology.)
RESULTS IN BRIEF
------------------------------------------------------------ Letter :1
EPA has taken several actions to expedite clean air rulemakings. In
January 1991, EPA eliminated a duplicative step in the agency's
internal review process, which officials estimate saved an average of
about 4 months for rulemakings. In June 1994, EPA made its most
far-reaching change--grouping rules into three categories and varying
the amount of interoffice coordination and management review needed
in each category. Under this process, over half of EPA's ongoing
clean air rules have been assigned to a "fast track" category. EPA
officials believe that if they involve senior managers earlier and
eliminate unneeded coordination for the rules in this category, the
rules will be completed 3 months sooner than the current average.
However, despite efforts to reform the rulemaking process, the agency
acknowledges having missed over 60 percent of the statutory deadlines
imposed by the 1990 act. Exacerbating this situation is the fact
that the agency does not have a system for identifying problem areas
in the rulemaking process or for assessing and tracking the impact of
the streamlining efforts. Consequently, EPA can neither demonstrate
that its streamlining efforts are actually reducing the time to issue
clean air rules, nor assess the effectiveness of its various
initiatives, such as reaching out to affected parties early in the
rule development process. Although agency officials recognize that
such a system could be useful, they said that in view of their
limited resources, issuing rules warrants a higher priority.
Although OMB has reduced the number of rules it reviews, it is too
early to tell if the changes that OMB has implemented will
significantly enhance EPA's ability to expedite clean air rules
because so few rules have been completed under the new process.
Since October 1, 1993, OMB has eliminated its review of over
one-third of EPA's ongoing clean air rulemakings in accordance with
the requirement of Executive Order 12866 that OMB focus only on
significant rules. OMB's past practice of reviewing most clean air
rules may have contributed to the lengthy rulemaking process. EPA
officials estimate that eliminating OMB's review of nonsignificant
rules may save from several days to 6 months for each rule.
We are recommending that the Administrator of EPA implement a
tracking system to record key dates, resources, and historical
information needed to monitor and evaluate the agency's clean air
rulemaking process.
BACKGROUND
------------------------------------------------------------ Letter :2
The passage of the Clean Air Act Amendments in November 1990 placed
many new and increased requirements on EPA to address significant air
pollution issues facing the nation, including ozone, acid rain, urban
air pollution, mobile source emissions, and toxic air pollution. EPA
and most other federal agencies use an informal (also known as
notice-and-comment) rulemaking process to translate statutory
mandates into rules and regulations.
In developing and issuing environmental rules, EPA must follow
procedures enumerated in several statutes, including the
Administrative Procedure Act, the Paperwork Reduction Act, and the
Regulatory Flexibility Act, among others. Additionally, most clean
air rulemakings must follow specific rulemaking procedures contained
in the Clean Air Act to ensure that EPA has considered the views of
interested and affected parties. EPA's standard rulemaking process,
employed agencywide since 1986, entails a multitude of activities in
order to take a rulemaking from inception to promulgation. (App. II
provides a flow chart (fig. II.1) and description of the major steps
in this process.)
Since the passage of the 1990 act, EPA has issued more proposed and
final air quality regulations and guidance documents in a shorter
period of time than at any other time in its history--over 150 by the
fall of 1993. However, delays in meeting many statutory deadlines
have continued. These delays have resulted in lawsuits and, in some
instances, court-ordered deadlines that, according to the EPA
Administrator, have hindered effective planning efforts. For
example, in the first 2 years of the act's implementation, EPA was
sued for missing 42 statutory deadlines. Generally, agency officials
cite three reasons for missing these deadlines: insufficient
resources, unrealistic original deadlines, and the lengthy rulemaking
process. As agreed with your offices, this report focuses only on
the last of these reasons.\1
--------------------
\1 Resource issues were addressed separately in our report entitled
Air Pollution: Reductions in EPA's 1994 Air Quality Program's Budget
(GAO/RCED-95-31BR, Nov. 29, 1994).
EPA'S EFFORTS TO STREAMLINE
CLEAN AIR RULEMAKINGS
------------------------------------------------------------ Letter :3
In 1990, EPA recognized that it needed to change its internal
rulemaking process if the agency was to meet the expanded rulemaking
responsibilities envisioned under the impending Clean Air Act
Amendments.\2 In January 1991, EPA's Office of Air and Radiation
(OAR)\3 modified the traditional rulemaking process by eliminating a
duplicative step in the process. According to OAR officials, this
action cut about 4 months out of a rulemaking process that was
averaging over 3 years.
In a further effort to expedite clean air rules, in June 1994 EPA
implemented its most far-reaching change--a revised agencywide
process designed to improve the quality and efficiency of
rulemakings. This new process groups rules into three categories, or
tiers, designed to produce quality rules at the lowest management
level practicable and with minimal administrative processes. The new
process calls for fundamental changes in how EPA approaches
rulemakings, including the early involvement of senior managers;
early and frequent consultation and consensus-building with
interested and affected parties outside of EPA; and, for many rules,
minimal internal coordination.
EPA envisions that tier 1 rules--generally expected to be those rules
that are the most costly, controversial, or of significant concern to
other EPA offices--will need the most management attention and
internal coordination. For such tier 1 rules, the new process calls
for ongoing involvement by the EPA Administrator's office and formal
cross-agency coordination at four distinct stages in rule
development: (1) early guidance, when EPA senior managers identify
the priority issues that must be addressed; (2) analytic blueprint,
when participants agree on the scientific, technical, economic,
legal, and intergovernmental information and analyses needed; (3)
alternatives selection, when the potential regulatory options are
narrowed down to one, or a few, preferred alternatives; and (4)
workgroup closure,\4 when workgroup members resolve all remaining
issues. While EPA's guidelines state that the new tiered process
will improve the quality and efficiency of rulemakings, agency
officials told us they do not anticipate any time savings for the
rules promulgated under tier 1 because of their complexity.
Rules promulgated under tier 2 need less high-level management
attention but still require senior management involvement at two
distinct stages in the rulemaking process--analytic blueprint and
workgroup closure. Because no rules in tier 2 have been completed
using the new process, OAR officials believe that it is too early to
assess whether tier 2 rules will be issued more quickly.
According to senior OAR officials, tier 3 is EPA's "fast track"
category. The clean air rules in this category are generally the
least costly and controversial and often involve only OAR staff and
management and EPA's Office of Enforcement and Office of General
Counsel. No analytic blueprint or workgroup closure is required for
the rules in tier 3. EPA officials anticipate that the rules in tier
3 will be promulgated faster than the rules in the other two tiers.
Table 1 shows EPA's distribution of the 207 ongoing clean air
rulemakings as of December 15, 1994.
Table 1
Ongoing Clean Air Rulemakings in Each
Tier as of December 15, 1994, and Time
Savings Predicted by EPA
Numb Percen
Category er t Predicted time savings
---------------------- ---- ------ ----------------------
Tier 1 9 4 None
Tier 2 90 43 Uncertain
Tier 3 108 52 Up to 3 months
------------------------------------------------------------
OAR officials explained that because the changes are new and the
process of taking a rule from inception to promulgation still
involves many activities, it will be 2 or more years before OAR will
be able to judge if these recent changes have had an effect on the
clean air rulemaking process.
--------------------
\2 As noted in the July 1990 report by the Clean Air Act
Implementation Task Force.
\3 OAR is responsible for promulgating clean air rules.
\4 Workgroups are EPA-wide, staff-level groups formed to ensure that
the agency's data collection and analysis methodology is sound and to
identify, assess, and, if possible, resolve key technical and policy
issues necessary to develop a proposed or final regulation.
EPA'S OTHER REGULATORY
STREAMLINING INITIATIVES
---------------------------------------------------------- Letter :3.1
In addition to instituting the tiered process, OAR officials told us
they are implementing other initiatives to try to expedite the
rulemaking process for selected clean air rules. Generally, these
initiatives involve reaching out to interested and affected parties
early in the rule development process or establishing partnerships
with state and local agencies, industry, and environmental groups;
such partnerships will allow EPA to benefit from the expertise and
resources these organizations can offer. (App. III provides a
detailed description of these rulemaking techniques.)
Because their experience with these techniques is limited, OAR
officials could not estimate the time savings from their use. For
example, one technique--regulatory negotiation\5 --has been used only
five times since the passage of the 1990 act, and another
technique--partnerships with state and local agencies and industry
and environmental groups--is so new that only two pilot projects are
ongoing, and none have been completed. Furthermore, some officials
cautioned that EPA must be selective in choosing which rules will
involve these rulemaking techniques because not all techniques are
appropriate for all clean air rules. In their opinion, using these
techniques on some rulemakings may cause the initial stages of the
process to take longer than they would have under the traditional
process. For example, regulatory negotiations that address complex
and/or controversial issues may initially take longer because such
negotiations are a very resource-intensive process for both EPA and
the participating groups. However, these techniques may save time in
the long run because they can produce a better quality rule that
receives fewer and less severe public comments and is less likely to
be challenged in court.
--------------------
\5 A regulatory negotiation is a formal process, under the Negotiated
Rulemaking Act of 1990, for allowing interested and affected parties
to negotiate the detailed requirements of a proposed regulation.
EPA LACKS SYSTEM FOR
ASSESSING EFFECTIVENESS OF
ITS STREAMLINING EFFORTS
---------------------------------------------------------- Letter :3.2
To date, EPA has not established a systematic way of assessing the
effectiveness of its initiatives to expedite the rulemaking process.
As a result, the agency is unable to demonstrate that its past
streamlining initiatives have actually reduced the time required to
issue clean air rules. As shown in appendix IV, even though EPA
missed 91 of 145 (63 percent) of the 1990 act's statutory deadlines,
the agency has not collected accurate, reliable information on the
time it takes to develop and issue rules. Such data would allow the
agency to identify problem areas or bottlenecks in the rulemaking
process and to accurately gauge the impact of streamlining efforts.
EPA's lack of data on rulemakings was also noted by the National
Performance Review's Regulatory Development Team in its August 1993
report to the EPA Administrator on EPA's regulation development
process. The report pointed out that
"Adequate data are not collected to allow the Agency to
continuously measure and evaluate the regulation development
process and the Agency does not routinely assess the efficiency
of its process or the quality of its product."
In July 1994, EPA's Assistant Administrator for Air and Radiation
tasked OAR with developing a system that senior managers could use to
monitor the progress of individual rules with statutory or
court-ordered deadlines, including each rule's deadlines and current
stage in the rulemaking process. While the resulting system--a
subset of OAR's Management and Accountability Process System
(MAPS)--is an improvement in EPA's rulemaking data base, it does not
maintain the key dates, length of time in each major phase of the
rulemaking process, allotted resources, or other historical
information that agency managers can use to assess the rulemaking
process. According to the manager of the MAPS data base, limitations
in the system's capacity cause some historical data to be eliminated
when new deadlines are entered. Thus, the new system still does not
allow the agency to identify problem areas in the rulemaking process
or measure the impact of streamlining efforts.
OAR officials said that developing a system for tracking the time
required to promulgate clean air rules has not been as high a
priority as committing their limited resources to issuing rules,
although they recognize that such a system could be useful. (App.
IV provides the best available data on EPA's record for meeting clean
air statutory deadlines through December 20, 1994--about 4 years
since the act's passage. Because of EPA's lack of data on
rulemakings, the agency was unable to provide us with information on
the time required to develop and promulgate clean air rules for this
time period.)
OMB'S REVIEW OF EPA'S RULES
------------------------------------------------------------ Letter :4
OMB has taken several actions to help expedite the rulemaking process
since Executive Order 12866 was issued on September 30, 1993. For
example, OMB has begun focusing its in-depth reviews on significant
rulemakings, defined in the executive order as those that have one or
more of the following effects:
Have an expected annual effect on the economy of $100 million or
more.
May adversely affect the economy in a material way.
Create a serious inconsistency or otherwise interfere with an action
taken or planned by another agency.
Materially alter the budgetary impact of entitlements, grants, user
fees, or loan programs or the rights and obligations of recipients
thereof.
Raise novel legal or policy issues arising out of legal mandates, the
President's priorities, or the principles set forth in Executive
Order 12866.
Whereas OMB's past practice was to review all nonroutine\6
clean air rules, OMB and EPA have agreed that 52 of 125, or 42
percent, of such ongoing rules will not undergo OMB review because
these rules do not meet the above criteria for an in-depth review by
OMB. According to EPA officials, the agreement means that these 52
rules may be promulgated from several days to 6 months sooner than
they would have been before the issuance of Executive Order 12866.
(App. II shows the steps eliminated from the clean air rulemaking
process when OMB forgoes its review.)
Executive Order 12866 specifies that nonsignificant rules-- those
that do not meet the criteria listed above--do not have to be
reviewed by OMB. OMB officials said that EPA provides them with a
one-page summary of all proposed or final rules and that, on the
basis of their review of this summary, OMB concurs or disagrees with
EPA's determination of a rule's significance. Subsequently, EPA and
OMB representatives may further discuss and resolve their differing
views on a rule's significance. Since September 30, 1993, when
Executive Order 12866 was issued, OMB has disagreed with EPA's
classification of 26 (21 percent) of EPA's 125 clean air rules. In
most of these cases, EPA had classified the rule as nonsignificant,
but OMB believed these rules were significant. After providing more
information to OMB on some rules, EPA obtained OMB's agreement that 3
rulemakings were nonsignificant and redesignated 23 rules as
significant. Nonetheless, EPA officials view this process favorably
and noted that OMB has agreed with over 75 percent of their
classifications (99 of 125 rulemakings).
--------------------
\6 Under both the prior and current executive orders, OMB does not
review routine regulatory actions, such as State Implementation Plans
(SIP). According to OMB, SIP actions have risen from about 120
actions in 1991 to nearly 500 actions in 1994.
OMB'S OTHER STREAMLINING
INITIATIVES
---------------------------------------------------------- Letter :4.1
OMB has initiated other actions to help expedite the rulemaking
process. For example, EPA and OMB officials said that in keeping
with the requirements of Executive Order 12866, OMB has generally
completed its reviews of significant clean air rulemakings within 90
days. OMB officials pointed out that they can complete reviews more
quickly now, in part because they are reviewing from one-fourth to
one-third fewer clean air rules than in past years. Although this
process is new, OMB's review of 60 proposed and final clean air rules
through September 30, 1994, averaged 34 days each, ranging from 1 to
116 days.\7
Two proposed clean air rules exceeded the 90-day review period
allowed under Executive Order 12866, but according to OMB officials,
EPA requested the extension in both cases. However, EPA officials
pointed out that since OMB reviews both the proposed and final rule,
OMB's impact on the length of the rulemaking process is cumulative;
thus, when OMB's review of both the proposed and final rule is
considered, the average of 34 days would double to an average of 68
days--over 2 months--for a complete rulemaking.
EPA officials said it is difficult to compare the time OMB took to
review clean air rules before and after the issuance of Executive
Order 12866. Before the new order, they said that in some instances
OMB would suspend its review and thus "stop the clock." OMB officials
said that they suspended a rule's review when EPA needed additional
time to collect more data, complete new analyses, or make changes to
the rule and that they restarted the "clock" and continued the review
when EPA resubmitted the rule to OMB. Thus, in the past, although
months or years might have passed before a rule cleared OMB's review,
OMB's data would show a much shorter time period. Executive Order
12866 does not provide for "suspending" the review of rules, and OMB
officials said that OMB is no longer engaging in this practice.
Currently, to ensure timely reviews, OMB's Office of Information and
Regulatory Affairs (OIRA)\8 staff meet weekly with the Administrator
of OIRA to discuss and resolve any outstanding issues on rules that
have been at OMB for 60 or more days or rules approaching statutory
or judicial deadlines. According to OMB staff, this process is
working well, as evidenced by the sparse number of rulemakings that
have exceeded 90 days.
Additionally, OMB has instituted several measures to improve
cooperation and communication with EPA staff. For example, in a
series of meetings with EPA staff over the last year, OMB and EPA
clarified the criteria for determining whether an EPA rule should be
classified as significant or nonsignificant. EPA staff are
optimistic that this guidance will assist them in correctly
classifying proposed and ongoing rulemakings and will reduce the
number of initial disagreements with OMB about a rule's significance.
Additionally, another initiative calls for the use of regulatory
policy officers as focal points for resolving conflicts with EPA and
other regulatory agencies. This mechanism gives the OIRA
Administrator a quick contact in each agency for elevating and
resolving rulemaking issues in a timely manner. Finally, OIRA
officials also pointed out that they have improved communications
with regulatory agencies' staffs by providing informal training in
how OMB conducts its regulatory reviews; the officials believe that
the training will help EPA staff understand and address OMB's
concerns and, in turn, issue rules faster.
EPA officials generally agreed with OIRA's May 1994 report, which
noted that a vastly improved relationship has developed between OIRA
and federal agencies since Executive Order 12866 was issued on
September 30, 1993. However, because only one clean air rule has
been completed under the new process (with both proposed and final
reviews by OMB), it is too early to assess the full impact of these
changes on EPA's ability to expedite clean air rulemakings. OIRA
officials said it will probably be 2 years or more before they can
assess the overall impact of these changes on the rulemaking process.
--------------------
\7 This analysis excludes eight clean air rules submitted before
OMB's 90-day review criteria were imposed on October 1, 1993, but
which OMB subsequently approved. Review time for these eight rules
averaged 79 days, ranging from 17 to 158 days. Of the 60 rules, only
1 rule had received both proposed and final reviews by OMB since
October 1, 1993.
\8 OIRA is responsible for reviewing clean air and other federal
agency rules.
CONCLUSIONS
------------------------------------------------------------ Letter :5
Officials from both EPA and OMB believed that the cumulative impact
of their collective efforts to reform the rulemaking process could
save from 4 to 13 months in a process that averaged nearly 37 months
at the time of the act's passage in 1990. Staffs of both agencies
said that communication and coordination have improved, which should
be helpful in resolving impasses that, in the past, resulted in rules
that took years to be issued.
However, the act clearly places the responsibility for meeting
milestones on EPA, and while the agency believes that these changes
will reduce the time to issue rules, it does not have a systematic
way of measuring the impact of its efforts. In our opinion, a
rulemaking tracking system would provide EPA with the information
needed to assess the impact of current and future changes to its
rulemaking process.
RECOMMENDATION
------------------------------------------------------------ Letter :6
To better ensure that EPA managers efficiently and appropriately
monitor the agency's efforts to meet statutory deadlines, we
recommend that the Administrator, EPA, implement a rulemaking
tracking system that maintains key dates for major phases in the
rulemaking process, provides for analysis of the length of time that
rules spend in major phases of the rulemaking process, and tracks the
resources allotted to rules and other historical information that
managers need to identify problem areas and measure the impact of
changes made.
---------------------------------------------------------- Letter :6.1
We discussed the information contained in this report with officials
from both OMB and EPA. At OMB, we talked to representatives of the
Administrator of the Office of Information and Regulatory Affairs.
At EPA, we discussed this information with representatives of the
Assistant Administrator for Air and Radiation, the Director of the
Office of Air Quality Planning and Standards, the Director of the
Office of Mobile Sources, and the Director of the Office of Policy,
Planning, and Evaluation. Officials from both agencies generally
agreed with the facts contained in this report and noted that the
report fairly characterized their efforts to expedite the development
and issuance of clean air rules, as well as the improved working
relationship between the staffs of the two agencies. Furthermore,
while EPA officials agreed that a rulemaking tracking system could be
useful, they indicated that issuing more rules was a higher priority
than developing and maintaining such a system. In our opinion,
however, the value of a tracking system--including identifying
problem areas and bringing about rulemaking efficiencies--warrants
such a management tool. EPA and OMB officials' comments are included
where appropriate. However, at your request we did not obtain
written agency comments on a draft of this report. We conducted our
review from March through December 1994 in accordance with generally
accepted government auditing standards.
Unless you publicly announce its contents earlier, we plan no further
distribution of this report until 30 days after the date of this
letter. At that time, we will send copies to the Director of OMB and
the Administrator of
EPA and make copies available to others upon request. If you have
any questions, please call me at (202) 512-6111. Major contributors
to this report are listed in appendix V.
Peter F. Guerrero
Director, Environmental
Protection Issues
OBJECTIVES, SCOPE, AND METHODOLOGY
=========================================================== Appendix I
Concerned about the Environmental Protection Agency's (EPA) lengthy
rulemaking process and the fact that the agency missed statutory
deadlines for clean air rules, the Ranking Minority Member of the
Senate Committee on Environment and Public Works and Senator Joseph
I. Lieberman asked us to describe EPA's progress in streamlining the
clean air rulemaking process and identify improvements that might
enhance EPA's efforts. They also asked us to describe the
corresponding efforts of the Office of Management and Budget (OMB) to
reduce the time associated with its review of such rules.
Our work focused on EPA's and OMB's completed, ongoing, and planned
efforts to reduce the time required to issue clean air rules since
the passage of the Clean Air Act Amendments in November 1990. In
carrying out our work, we also considered both agencies' initiatives
to streamline their rulemaking procedures as part of their efforts to
implement Executive Order 12866 and the recommendations of the
National Performance Review. To address the efforts made at EPA to
streamline the agency's clean air rulemaking procedures, we
interviewed officials and obtained documents from the following EPA
offices:
Office of Air and Radiation, Washington, D.C.;
Office of General Counsel, Washington, D.C.;
Office of Policy, Planning and Evaluation, Washington, D.C.;
Office of Enforcement and Compliance Assurance, Washington, D.C.;
Office of Mobile Sources, Washington, D.C.; and
Office of Air Quality Planning and Standards, Durham, N.C.
To address efforts made by OMB to streamline the agency's review of
clean air rules, we interviewed officials and obtained documents from
OMB's Office of Information and Regulatory Affairs.
OVERVIEW OF THE TRADITIONAL
PROCESS FOR CLEAN AIR RULEMAKING
========================================================== Appendix II
We developed the following flow chart (fig. II.1) in an effort to
simplify and categorize the multitude of activities involved in
developing and promulgating clean air rules. While this flow chart
is not a formal agency model, it was prepared with the assistance of
EPA senior air program officials who agreed that these steps present
a fair framework for depicting the traditional rulemaking process and
illustrating the steps where EPA's and OMB's initiatives may expedite
rulemakings. A general description of each step follows the chart.
Figure II.1: Steps Shortened
or Eliminated by New Rulemaking
Process
(See figure in printed
edition.)
Note: Time estimates were
taken from a report by the
Clean Air Act Implementation
Task Force to the Deputy
Administrator, dated July 1990,
and EPA/OAR officials.
(See figure in printed
edition.)
In step 1, EPA develops a one page description of the environmental
problem(s) to be addressed by the rule and assigns the rule a Start
Action Notice (SAN) number. In concept, this is the rule's
beginning.
For air rules, in step 2, EPA establishes a workgroup, led by a
representative of the Office of Air and Radiation, to identify,
assess and, if possible, resolve key technical and policy issues;
assess any data needs and limitations; devise a work plan; collect
the necessary scientific and technical information to support and
defend the rulemaking action; and evaluate regulatory options,
including assessing the health and environmental risks and the
costs-benefits of available regulatory options. Once sufficient
information has been collected and analyzed, a draft regulatory
package is prepared that includes the intent, purpose, scope, and
authority for the regulation. At this point, the workgroup assesses
the quality of the proposed regulation and reaches agreement on as
many open issues as possible before forwarding the regulatory package
to OAR senior management for review, resolution of any significant
unresolved issues, and approval.
After OAR management approves the regulatory package, it moves to
step 3 for coordination with other EPA media offices (such as the
Office of Water). This is called cross-agency coordination. All
tier 1 or tier 2 rules receive this coordination. Tier 3 rules that
do not affect other EPA offices skip this step. Other tier 3 rules
may have this step shortened because they would be coordinated only
with the media office they may affect. In this step, senior managers
from all other interested or affected media offices within EPA review
the draft regulation and supporting materials to assess the rule's
impact on their programs, resolve any remaining issues, and assess
the quality of the proposed regulation.
Draft air rules then move to step 4 for review and approval by OAR.
Once EPA management is satisfied internally with the proposed rule, a
significant rule moves to step 5. This step is eliminated for
nonsignificant rules. A rule that undergoes this step is submitted
to OMB/OIRA for an independent assessment of the rule's costs and
benefits and impact on the economy, among other things. After OIRA
approves it, the proposed rule is returned to EPA.
In step 6, the EPA Administrator reviews and approves draft rules,
after which they are published in the Federal Register.
In step 7, interested and affected parties have an opportunity to
comment on the proposal. These comments are placed in a docket\1
that is open for public review.
In step 8, depending on the severity of the comments and whether new
information has been introduced, EPA may have minimal or substantive
issues to be addressed before the agency can proceed to final
rulemaking. Comments may cause EPA to have to reconvene the agency
workgroup, collect and analyze more data in support of a rule, more
thoroughly evaluate other regulatory options previously excluded or
given low priority, or significantly alter selected aspects of the
proposed rule. Except for public comment, final rules generally
follow the same review and approval process that proposed rules
follow. Under the Clean Air Act, for most rules, EPA must respond to
all substantive comments in the docket, as well as provide a written
explanation of any substantive changes between the proposed and final
rules, at the time the final rule is issued. According to agency
officials, in practice EPA takes these actions for all clean air
rules.
In step 9, final draft tier 1 and tier 2 rules receive cross-agency
coordination, as in step 3. Also, tier 3 rules may have this step
shortened or eliminated, as described in step 3.
In step 10, final rules are reviewed and approved by OAR management,
as in step 4, before being sent to OMB.
In step 11, all significant final rules receive OMB's review and
concurrence, as in step 5. However, nonsignificant rules eliminate
this review step, as they did in step 5.
In step 12, the EPA Administrator reviews and approves all final
rules and publishes them in the Federal Register.
--------------------
\1 The docket is the collection of documents that form the record for
any judicial review of EPA's rulemaking actions. It generally
consists of scientific and technical reports and data, transcripts of
public hearings, drafts of proposed and final rules, and the
correspondence, memorandums, and comments that EPA used or considered
to make a rule.
ADDITIONAL INFORMATION ON EPA'S
INITIATIVES TO STREAMLINE THE
CLEAN AIR RULEMAKING PROCESS
========================================================= Appendix III
Since the passage of the Clean Air Act Amendments of 1990 but before
EPA instituted the tier process in June 1994, the agency initiated
five other completed or ongoing efforts to reduce the time required
to promulgate clean air rules. This appendix provides additional
details on each of the five initiatives, including their benefits,
limitations, and extent of use through September 30, 1994.
ELIMINATION OF RED BORDER
REVIEW
----------------------------------------------------- Appendix III:0.1
Before the passage of the Clean Air Act Amendments in November 1990,
EPA's Clean Air Act Implementation Task Force recognized that EPA
needed to change its internal rulemaking process if the agency was to
meet its expanded rulemaking responsibilities envisioned under the
impending act. In its July 1990 report, the task force recommended,
among other things, that EPA use "workgroup closure"\1 as the
agency's final approval of a rulemaking, in lieu of the traditional
consecutive review processes that EPA had been using. In January
1991, OAR eliminated one step in the agency's traditional rulemaking
process--red border review--saving an estimated 16 weeks, or about 4
months, according to an OAR senior official.
--------------------
\1 Workgroups are EPA-wide, staff-level groups formed to ensure that
the agency's data collection and analysis methodology is sound and to
identify, assess, and, if possible, resolve key technical and policy
issues necessary to develop a proposed or final regulation.
CONSULTATION AND
CONSENSUS-BUILDING
----------------------------------------------------- Appendix III:0.2
Under the consultation and consensus-building technique, EPA
recognizes that the most effective rules are not only technically
sound and legally defensible, but also readily implementable--that
is, rules for which the concerns of major interest groups have been
thoroughly considered and fairly addressed. EPA believes that early,
informal consultation with interested groups and affected parties can
save time by allowing direct input into the drafting of the
regulation, seeking a more pragmatic solution among competing
interests, reducing the number and severity of adverse comments
during the public comment period, and minimizing the likelihood of
litigation after promulgation. OAR officials said that they have not
tracked the number of clean air rules for which this technique has
been used, but they estimate that some form of this technique--such
as convening a multidisciplinary roundtable early in rule
development--has been employed on more than 100 rulemakings since
1990.
REGULATORY NEGOTIATION
----------------------------------------------------- Appendix III:0.3
Under the regulatory negotiation technique, interested and affected
parties negotiate the detailed requirements of a proposed clean air
rule. Negotiation is done by a federally chartered advisory
committee consisting of one or more representatives of the regulated
public, public interest groups, and state and local governments who
join with an EPA representative to negotiate the text of a proposed
rule before it is published in the Federal Register. Regulatory
negotiations are carried out in accordance with the Negotiated
Rulemaking Act of 1990, the Federal Advisory Committee Act, and EPA's
internal policies. EPA officials said regulatory negotiations can
save time by allowing interested and affected parties more direct
input into the drafting of the regulation, seeking a more pragmatic
solution among competing interests, reducing the number and severity
of adverse comments during the public comment period, and minimizing
the likelihood of litigation after promulgation. Regulatory
negotiations still have to undergo the traditional public comment
period.
Furthermore, EPA officials said this technique will not work for all
rulemakings because it is initially very resource-intensive for EPA
and the participating groups, a factor that has caused EPA to be
highly selective in choosing this approach. They also said this
technique may take longer in some cases than the traditional
rulemaking approach because more planning and negotiations take place
to develop a better rule. As of September 30, 1994, the agency had
used regulatory negotiations for only five clean air rulemakings.
The five clean air rules negotiated under this approach were
Small Non-Road Engines Emissions Controls,
Reformulated Fuels,
National Emissions Standards for Coke Oven Batteries,
Wood Furniture Manufacturing Industry VOC (volatile organic
compounds) Emission Controls, and
Architectural and Industrial Maintenance Coatings.
ELECTRONIC FEDERAL
REGISTERING
----------------------------------------------------- Appendix III:0.4
Under the electronic federal registering technique, EPA officials
said the agency saves money by eliminating the need to pay the
Government Printing Office (GPO) for proofing and typesetting
thousands of pages for the Federal Register. Instead, EPA staff
ensure the accuracy of notices and deliver a data disk to GPO ready
for printing. While EPA officials said that this technique does not
save time, it saves money that can be used elsewhere to develop data
to support rules and thereby possibly save time in the rulemaking
process. EPA officials estimate this technique is saving about
$500,000 yearly.
DEVELOPING AIR POLLUTANT
STANDARDS WITH PARTNERS
----------------------------------------------------- Appendix III:0.5
Under the 1990 act, EPA must establish maximum achievable control
technology (MACT) standards for 189 of the nation's most hazardous
and pervasive toxic air pollutants. For a limited group of rules for
toxic air pollutants, EPA plans to establish informal partnerships
with state and local governments, industry, and environmental groups
that allow the agency to benefit from the expertise and resources
these organizations can offer. These partnerships are established
early in the MACT rulemaking process for the purpose of identifying
the data available, resolving critical issues early, and reaching
agreement on which non-EPA organization will either take the lead in
developing the rule or work closely with EPA in developing the rule.
By taking this approach, EPA officials believe that the time and
resources required to set each MACT standard will be reduced if EPA,
during the process, can obtain consensus from those groups who have
stakes in regulating toxic air pollutants.
EPA is currently exploring two types of partnering techniques. The
first, "share-a-MACT," is an approach whereby EPA shares MACT
development responsibilities with one or more groups having a strong
interest in the rule. EPA officials said that in such cases, a
non-EPA group willing to commit resources to developing supporting
data and, in some instances, the initial draft of the proposed rule,
agrees to operate under EPA's general direction. Such nontraditional
rulemakings are expected to save EPA time and resources, but they may
be limited by the need for the affected industries to be relatively
homogenous and have a strong national association with authority to
act in their collective best interests. EPA currently has two pilot
projects under way to evaluate this technique.
A second technique is "adopt-a-MACT," an approach whereby EPA allows
either a state or local air pollution agency with expertise in the
particular toxic air pollutant in question to take the lead in
developing the supporting data and initial draft of the proposed
rule. Such rulemakings are expected to save EPA time and resources,
but they are limited to situations in which the industry to be
regulated is located in one or a few states. According to EPA
officials, as of September 30, 1994, this approach had not been used,
although EPA officials said that some states have expressed a
willingness to undertake projects under this approach. For example,
they said the states of Arizona and New Mexico are interested in
jointly undertaking the development of MACT for primary copper
smelters. Their interest is important because these two states have
the expertise in regulating this industry, since all of the copper
smelters in the United States are located in those states.
STATUTORY DEADLINES MET AND MISSED
FOR EPA'S CLEAN AIR RULEMAKINGS
========================================================== Appendix IV
Table IV.1
Number of Statutory Deadlines Met and
Missed, Annually, Through November 15,
1994.
11/15/ 11/15/ 11/15/ 11-15-
Status 91\a 92\b 93\c 94\d
-------------------- -------- -------- -------- --------
Number due 23 53 27 42
Number met 11 13 10 20
Number missed 12\e 40\f 17\g 22\h
------------------------------------------------------------
Note: The information presented includes some statutorily mandated
studies, reports, or other activities; however, according to agency
officials, the majority of the actions required were clean air
rulemakings due on or before the date indicated.
\a Includes statutorily mandated actions from 11/16/90 to 11/15/91.
\b Includes statutorily mandated actions from 11/16/91 to 11/15/92.
\c Includes statutorily mandated actions from 11/16/92 to 11/15/93.
\d Includes statutorily mandated actions from 11/16/93 to 11/15/94.
\e EPA has since issued 11 of 12 rules that did not meet the 11/15/91
deadline.
\f EPA has since issued 36 of 40 rules that did not meet the 11/15/92
deadline.
\g EPA has since issued 8 of 17 rules that did not meet the 11/15/93
deadline.
\h EPA has since issued 4 of 22 rules that did not meet the 11/15/94
deadline.
SUMMARY: Of 145 statutorily mandated actions from 11/15/90 to
11/15/94, EPA met 54 deadlines and missed 91. As of 12/15/94, EPA
had issued 59 of the 91 rulemaking actions that missed the statutory
deadlines; work was under way on the remaining rules missed as well
as new rulemakings required in coming years. EPA officials pointed
out that while the agency's record on meeting statutory milestones
could be better, EPA has not missed any court-ordered deadlines for
clean air rules.
Source: EPA's Management and Accountability Process System; data as
of November 15, 1994.
Table IV.2
Unmet Clean Air Act Statutory Deadlines
as of December 20, 1994
Statutor
y
Name of rule deadline
-------------------------------------------------- --------
States submit selected State Implementation Plan 11/15/
(SIP) provisions for moderate and above ozone 93
nonattainment areas
Report to Congress on the California low- 06/30/
emissions vehicle 94
EPA action on final phase I sulfur dioxide and 08/15/
nitrogen oxide permits 93
Submit consumer/commercial products emissions 11/15/
report to Congress 93
Submit Section 811 report (international 08/15/
competitiveness) to Congress 92
Publish results of ozone design value study 11/15/
93
Publish wood furniture emissions control 11/15/
techniques guidelines 93
Finalize sulfur dioxide allowance opt-in- 05/15/
regulation -combustion sources 92
Publish final acid deposition standards study 11/15/
93
Final guidance for modification of major sources 05/15/
of hazardous air pollutants 92
Final maximum achievable control technology (MACT) 11/15/
standards for secondary lead smelters 94
Finalize MACT standards for petroleum refineries 11/15/
94
Final MACT standards for aerospace industry 11/15/
94
Promulgate standards for large municipal waste 11/15/
combustors 91
Promulgate standards for small municipal waste 11/15/
combustors 92
Finalize rules for risk management plans and 11/15/
prevention of accidental releases of hazardous 93
air pollutants
Study of emissions from electric utilities 11/15/
generating units 93
Nitrogen oxides New Source Performance Standards 01/01/
for new fossil fuel fired utilities 94
Publish surface coal mining emissions study 11/15/
93
Promulgate nitrogen oxides emissions reduction 05/15/
rule 92
Initiate operation of allowance tracking system 05/15/
92
Report to Congress: production/consumption of 11/15/
ozone depleting chemicals 93
Report on Acid Rain program in Canada 01/01/
94
Promulgate rules for enhanced monitoring of major 11/15/
stationary sources 92
Promulgate chlorofluorocarbon labeling regulations 05/15/
92
MACT standards for polymers and resins I 11/15/
94
MACT standards for polymers and resins II 11/15/
94
Medical waste incinerator rule 11/15/
92
Promulgate MACT standards for printing and 11/15/
publishing 94
Promulgate MACT standards for asbestos 11/15/
94
Promulgate MACT standards for wood furniture 11/15/
94
Promulgate MACT standards for off site waste 11/15/
94
Promulgate MACT standards for shipbuilding 11/15/
94
Promulgate tank vessel emissions rule 11/15/
92
------------------------------------------------------------
Source: Planning Staff, Office of the Director, Office of Air
Quality Planning and Standards, EPA's Office of Air and Radiation.
MAJOR CONTRIBUTORS TO THIS REPORT
=========================================================== Appendix V
RESOURCES, COMMUNITY, AND ECONOMIC
DEVELOPMENT DIVISION, WASHINGTON,
D.C.
Allen Li, Associate Director
William F. McGee, Assistant Director
NORFOLK REGIONAL OFFICE
James R. Beusse, Evaluator-in-Charge
Hamilton C. Greene, Jr., Evaluator
Philip L. Bartholomew, Evaluator