On Monday, the Office of Management and Budget (OMB) released a memorandum dated March 2, 2017, outlining guidelines and procedures for executive agency submissions to the Spring 2017 Unified Agenda of Federal Regulatory and Deregulatory Actions (Unified Agenda). According to the Memorandum, the agency submissions, which are due on March 31, 2017, must “give especially careful attention to the principles and requirements identified” in the President’s January 30, 2017, Executive Order Reducing Regulation and Controlling Regulatory Costs, also referred to as “One-In, Two-Out.”
Since the late 1970s, federal agencies have been required to prepare a list of regulatory and deregulatory activities that are in development or under review; its goals include enhancing agency planning and coordination, and making the regulatory process more accessible and open to the public. The Unified Agenda provides a compilation of these activities, covering approximately 60 federal departments, agencies, and commissions. The Unified Agenda is published twice each year. The fall edition includes each agency’s “Regulatory Plan.” The “Regulatory Plan” is a more focused portion the Unified Agenda in that it includes summaries of significant regulations,* rather than all regulations in development or under review.
OMB’s March 2, 2017, Memorandum states that in submitting information for the upcoming spring edition of the Unified Agenda, agencies must include information to comply with the One-In, Two-Out Executive Order. That Executive Order includes two major directives. First, it sets a “Regulatory Cap” for fiscal year 2017, requiring that for every new significant regulation an agency proposes for notice and comment or otherwise promulgates, the agency must identify at least two existing regulations to repeal. The Regulatory Cap requires that “the total incremental cost of all new regulations, including repealed regulations … shall be no greater than zero.” That means, as OMB clarified in earlier-issued guidance, that the savings from the two proposed “deregulatory” actions must fully offset the cost of the new regulatory action.
Second, beginning with Regulatory Plans for fiscal year 2018 (i.e. Regulatory Plan submissions for the fall 2017 Unified Agenda) and for each fiscal year thereafter, agency heads must identify for each proposed significant regulatory action two offsetting regulations and an approximation of the total costs or savings associated with each new regulation or repealed regulation. The Executive Order directs OMB to identify during the President’s budgeting process the total amount of incremental costs that each agency will be allowed in issuing new regulations and repealing regulations for the next fiscal year. OMB will approve agency proposals only if they fall within the total incremental cost allowance, and only regulations approved by OMB will be included in the Unified Agenda. The Executive Order mandates that agencies may only issue regulations that were included in the most recent version or update of the Unified Agenda.
According to the March 2, 2017, Memorandum, agency submissions for the spring 2017 Unified Agenda must now “reflect attention to the following requirements:
- The total incremental costs of any new significant regulatory actions issued between noon on January 20, 2017 and September 30, 2017 shall, to the extent permitted by law, be fully offset as of September 30, 2017; and
- Agencies should, for each new significant regulatory action that imposes costs and that an agency plans to issue on or before September 30, 2017, identify two existing regulatory actions the agency plans to eliminate or propose for elimination on or before September 30, 2017.”
The Memorandum accelerates some of the timelines provided for in the One-In, Two-Out Executive Order. Although the Executive Order itself applies to Regulatory Plans beginning in fiscal year 2018, the Memorandum instructs agencies to include “a preliminary estimate of the total costs or savings associated with each … planned fiscal year 2018 significant regulatory actions and offsetting deregulatory actions.” As such, we will we start seeing the impacts of the One-In, Two-Out Executive Order on agency rulemaking for 2017 and 2018 as soon as this spring.
* A September 30, 1993, Executive Order, Regulatory Planning and Review, established the Unified Agenda and defines a “significant regulatory action” for inclusion in the Regulatory Plan as one that may: (a) have an annual effect on the economy of $100 million or more, or adversely affect the economy in any material way; (b) create a serious inconsistency or otherwise interfere with an action taken or planned by another agency; (c) materially alter the budgetary impact of entitlements, grants, user fees, or loan programs, or the rights and obligations of their recipients; or (d) raise novel legal or policy issues.