Reexamining Regulations:

Opportunities Exist to Improve Effectiveness and Transparency of Retrospective Reviews

GAO-07-791: Published: Jul 16, 2007. Publicly Released: Aug 15, 2007.

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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presidents require agencies to review existing regulations to determine whether they should be retained, amended, or rescinded, among other things.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.

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.

Matter for Congressional Consideration

  1. Status: Closed - Not Implemented

    Comments: As of August 2013 Congress has not taken any action to implement this Matter for Congressional Consideration.

    Matter: 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.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: On January 18, 2011, the President issued Executive Order 13563 on improving regulation and regulatory review and on February 2, 2011 and April 25, 2011 the Office of Management and Budget issued supplemental guidance to federal agencies on how to conduct retrospective analysis of existing significant regulations, which addressed findings and recommendations in our report. The guidance issued on April 25, 2011 directed agencies to design and write future regulations in ways that will facilitate evaluation of their consequences and thus promote retrospective analyses. The guidance further stated that, to the extent consistent with law, agencies should give careful consideration to how best to promote empirical testing of the effects of rules both in advance and retrospectively.

    Recommendation: The Director of the Office of Management and Budget, through the Administrator of the Office of Information and Regulatory Affairs (OIRA), and the Chief Counsel for Advocacy should develop guidance to regulatory agencies to consider or incorporate into their policies, procedures, or agency guidance documents that govern regulatory review activities 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.

    Agency Affected: Executive Office of the President: Office of Management and Budget: Office of Information and Regulatory Affairs

  2. Status: Closed - Implemented

    Comments: In response to GAO's draft report and recommendations, the Office of Advocacy in May and June 2007 prepared supplemental guidance to federal agencies on how to conduct retrospective reviews of existing regulations under Section 610 of the Regulatory Flexibility Act. An initial draft of this guidance was submitted to GAO and included in GAO's July 2007 final report. A final version of this "best practices" guidance, based on comments received by Advocacy from interagency review, was finalized and incorporated as appendix C in Advocacy's "Report on the Regulatory Flexibility Act, FY 2007," published in February 2008. The guidance covers multiple aspects of retrospective regulatory review requirements, such as the timing, scope, and purpose of a periodic rule review, the required elements of a review, when other retrospective reviews can be considered functionally equivalent to a section 610 review, and ways to improve the transparency of the review process. Advocacy specifically provided guidance about the data and assumptions used to conduct a retrospective review in its discussion of the scope of a review and what should be included. In August 2007, Advocacy supplemented its best practices guidance by implementing the R3 initiative (Regulatory Review and Reform Initiative). Advocacy will also be making training available to federal agencies on how to comply with section 610's requirements.

    Recommendation: The Director of the Office of Management and Budget, through the Administrator of the Office of Information and Regulatory Affairs (OIRA), and the Chief Counsel for Advocacy should develop guidance to regulatory agencies to consider or incorporate into their policies, procedures, or agency guidance documents that govern regulatory review activities 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.

    Agency Affected: Small Business Administration: Office of Advocacy

  3. Status: Closed - Implemented

    Comments: On January 18, 2011, the President issued Executive Order 13563 on Improving Regulation and Regulatory Review and on February 2, 2011, the Office of Management and Budget issued supplemental guidance to federal agencies on how to conduct retrospective analysis of existing regulations, which addressed findings and recommendations in our report. Consistent with our recommendation on prioritization, the guidance directed agencies to specify factors that the agency will consider and the process that the agency will use in setting priorities and in selecting rules for review.

    Recommendation: 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 should develop guidance to regulatory agencies to consider or incorporate into their policies, procedures, or agency guidance documents that govern regulatory review activities 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.

    Agency Affected: Executive Office of the President: Office of Management and Budget: Office of Information and Regulatory Affairs

  4. Status: Closed - Implemented

    Comments: In response to GAO's draft report and recommendations, the Office of Advocacy in May and June 2007 prepared supplemental guidance to federal agencies on how to conduct retrospective reviews of existing regulations under Section 610 of the Regulatory Flexibility Act. An initial draft of this guidance was submitted to GAO and included in GAO's July 2007 final report. A final version of this "best practices" guidance, based on comments received by Advocacy from interagency review, was finalized and incorporated as appendix C in Advocacy's "Report on the Regulatory Flexibility Act, FY 2007," published in February 2008. The guidance covers multiple aspects of retrospective regulatory review requirements, such as the timing, scope, and purpose of a periodic rule review, the required elements of a review, when other retrospective reviews can be considered functionally equivalent to a section 610 review, and ways to improve the transparency of the review process. Advocacy specifically provided guidance about the factors that agencies should consider when selecting rules for review. In August 2007, Advocacy supplemented its best practices guidance by implementing the R3 initiative (Regulatory Review and Reform Initiative). Advocacy designed the R3 initiative to identify and address existing federal rules that should be reviewed and may need reforming. The R3 initiative incorporates the factors under section 610 that agencies should consider when identifying rules for review, but it also includes a process by which interested small entities can nominate existing rules for review and potential reform.

    Recommendation: 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 should develop guidance to regulatory agencies to consider or incorporate into their policies, procedures, or agency guidance documents that govern regulatory review activities 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.

    Agency Affected: Small Business Administration: Office of Advocacy

  5. Status: Closed - Implemented

    Comments: On January 18, 2011, the President issued Executive Order 13563 on Improving Regulation and Regulatory Review and on February 2, 2011, the Office of Management and Budget issued supplemental guidance to federal agencies on how to conduct retrospective analysis of existing regulations, which addressed findings and recommendations in our report. Consistent with our recommendation on increasing the rigor of retrospective analyses, the guidance directed agencies to include input from the public and incorporate an assessment of costs and benefits of the regulations as part of the analyses, when useful.

    Recommendation: 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 should develop guidance to regulatory agencies to consider or incorporate into their policies, procedures, or agency guidance documents that govern regulatory review activities 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.

    Agency Affected: Executive Office of the President: Office of Management and Budget: Office of Information and Regulatory Affairs

  6. Status: Closed - Implemented

    Comments: In response to GAO's draft report and recommendations, the Office of Advocacy in May and June 2007 prepared supplemental guidance to federal agencies on how to conduct retrospective reviews of existing regulations under Section 610 of the Regulatory Flexibility Act. An initial draft of this guidance was submitted to GAO and included in GAO's July 2007 final report. A final version of this "best practices" guidance, based on comments received by Advocacy from interagency review, was finalized and incorporated as appendix C in Advocacy's "Report on the Regulatory Flexibility Act, FY 2007," published in February 2008. The guidance covers multiple aspects of retrospective regulatory review requirements, such as the timing, scope, and purpose of a periodic rule review, the required elements of a review, when other retrospective reviews can be considered functionally equivalent to a section 610 review, and ways to improve the transparency of the review process. Advocacy specifically provided guidance about the factors that agencies should apply when conducting retrospective reviews, including public comments and data submitted by the public. In August 2007, Advocacy supplemented its best practices guidance by implementing the R3 initiative (Regulatory Review and Reform Initiative).

    Recommendation: 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 should develop guidance to regulatory agencies to consider or incorporate into their policies, procedures, or agency guidance documents that govern regulatory review activities 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.

    Agency Affected: Small Business Administration: Office of Advocacy

  7. Status: Closed - Implemented

    Comments: On January 18, 2011, the President issued Executive Order 13563 on improving regulation and regulatory review. The executive order states that retrospective analyses, including supporting data, should be released online whenever possible. In several places the guidance also encourages agencies to publish their plans for retrospective reviews on their online Open Government Webpage and otherwise take various actions to promote public outreach and participation.

    Recommendation: 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 should develop guidance to regulatory agencies to consider or incorporate into their policies, procedures, or agency guidance documents that govern regulatory review activities 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.

    Agency Affected: Executive Office of the President: Office of Management and Budget: Office of Information and Regulatory Affairs

  8. Status: Closed - Implemented

    Comments: In response to GAO's draft report and recommendations, the Office of Advocacy in May and June 2007 prepared supplemental guidance to federal agencies on how to conduct retrospective reviews of existing regulations under Section 610 of the Regulatory Flexibility Act. An initial draft of this guidance was submitted to GAO and included in GAO's July 2007 final report. A final version of this "best practices" guidance, based on comments received by Advocacy from interagency review, was finalized and incorporated as appendix C in Advocacy's "Report on the Regulatory Flexibility Act, FY 2007," published in February 2008. The guidance covers multiple aspects of retrospective regulatory review requirements, such as the timing, scope, and purpose of a periodic rule review, the required elements of a review, when other retrospective reviews can be considered functionally equivalent to a section 610 review, and ways to improve the transparency of the review process. Advocacy specifically provided guidance about documenting reviews and informing the public about the results of completed reviews. As part of that guidance, Advocacy said that agencies should indicate the sources of the data used for their analyses, should be able to provide that data, and should explain their assumptions so that stakeholders can understand agencies' analyses. In August 2007, Advocacy supplemented its best practices guidance by implementing the R3 initiative (Regulatory Review and Reform Initiative). One of the purposes of R3 is to make the retrospective review process more transparent and accessible to the public. The R3 initiative also includes a process for interested small business stakeholders to monitor the progress of that agencies make toward reforming regulations.

    Recommendation: 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 should develop guidance to regulatory agencies to consider or incorporate into their policies, procedures, or agency guidance documents that govern regulatory review activities 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.

    Agency Affected: Small Business Administration: Office of Advocacy

  9. Status: Closed - Implemented

    Comments: On January 18, 2011, the President issued Executive Order 13563 on improving regulation and regulatory review and on February 2, 2011, the Office of Management and Budget issued supplemental guidance to federal agencies on how to conduct retrospective analysis of existing regulations, which directed agencies to improve the transparency of the review process, including holding town hall meetings and online equivalents, and providing a period of public comment after drafts of preliminary plans for retrospective reviews are written and/or after such plans have been submitted to OIRA. The guidance also suggested that agencies may want to reach out to stakeholders with an interest in the rules mentioned in the preliminary plans to ensure that diverse views are considered and to also consider developing mechanisms to promote public consultation about existing rules on a continuing basis.

    Recommendation: 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 should develop guidance to regulatory agencies to consider or incorporate into their policies, procedures, or agency guidance documents that govern regulatory review activities 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.

    Agency Affected: Executive Office of the President: Office of Management and Budget: Office of Information and Regulatory Affairs

  10. Status: Closed - Implemented

    Comments: In response to GAO's draft report and recommendations, the Office of Advocacy in May and June 2007 prepared supplemental guidance to federal agencies on how to conduct retrospective reviews of existing regulations under Section 610 of the Regulatory Flexibility Act. An initial draft of this guidance was submitted to GAO and included in GAO's July 2007 final report. A final version of this "best practices" guidance, based on comments received by Advocacy from interagency review, was finalized and incorporated as appendix C in Advocacy's "Report on the Regulatory Flexibility Act, FY 2007," published in February 2008. The guidance covers multiple aspects of retrospective regulatory review requirements, such as the timing, scope, and purpose of a periodic rule review, the required elements of a review, when other retrospective reviews can be considered functionally equivalent to a section 610 review, and ways to improve the transparency of the review process. Advocacy specifically provided guidance about documenting reviews and informing the public about the results of completed reviews. In August 2007, Advocacy supplemented its best practices guidance by implementing the R3 initiative (Regulatory Review and Reform Initiative). One of the purposes of r3 is to make the retrospective review process more transparent and accessible to the public. The r3 initiative also includes a process for interested small business stakeholders to monitor the progress that agencies make toward reforming regulations.

    Recommendation: 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 should develop guidance to regulatory agencies to consider or incorporate into their policies, procedures, or agency guidance documents that govern regulatory review activities 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.

    Agency Affected: Small Business Administration: Office of Advocacy

  11. Status: Closed - Implemented

    Comments: On January 18, 2011, the President issued Executive Order 13563 on "Improving Regulation and Regulatory Review" and on February 2, 2011, the Office of Management and Budget issued supplemental guidance to federal agencies on how to conduct retrospective analysis of existing regulations, which addressed findings and recommendations in our report. Consistent with our recommendation on promoting sustained management and institutionalization of retrospective review activities, the guidance directed agencies to address the structure and staffing of their retrospective review plans and ensure that responsibility for retrospective review is vested with a high-level agency official who can secure cooperation across the agency.

    Recommendation: 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 should develop guidance to regulatory agencies to consider or incorporate into their policies, procedures, or agency guidance documents that govern regulatory review activities steps to promote sustained management attention and support to help ensure progress in institutionalizing agency regulatory review initiatives.

    Agency Affected: Executive Office of the President: Office of Management and Budget: Office of Information and Regulatory Affairs

  12. Status: Closed - Implemented

    Comments: On August 7, 2009 the Assistant Chief Counsel for Advocacy described in writing actions that the Office has taken to promote sustained management attention and support to help ensure progress in institutionalizing agency retrospective regulatory review initiatives. According to Advocacy, the section 610 guidance that it created, in conjunction with training federal agencies on how to comply with section 610's requirements and using the Office's new R3 program to focus the attention of agencies on retrospective reviews promoted sustained management attention on agency retrospective review activities, and resulted in agency rule reforms.

    Recommendation: 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 should develop guidance to regulatory agencies to consider or incorporate into their policies, procedures, or agency guidance documents that govern regulatory review activities steps to promote sustained management attention and support to help ensure progress in institutionalizing agency regulatory review initiatives.

    Agency Affected: Small Business Administration: Office of Advocacy

  13. Status: Closed - Implemented

    Comments: On January 18, 2011, the President issued Executive Order 13563 on improving regulation and regulatory review and on February 2, 2011, the Office of Management and Budget issued supplemental guidance to federal agencies on how to conduct retrospective analysis of existing regulations, which addressed the spirit of the recommendation by requiring that all agency plans for retrospective reviews in response to E.O. 13563 be coordinated with other forms of retrospective analysis and review. The guidance established an explicit expectation that agencies' preliminary plans for periodically reviewing their significant regulations address such coordination. The guidance further clarified that work conducted by the agencies to satisfy other retrospective reviews requirements, such as those in the Regulatory Flexibility Act, can be used to address the requirements in Executive Order 13563.

    Recommendation: 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 should 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.

    Agency Affected: Executive Office of the President: Office of Management and Budget: Office of Information and Regulatory Affairs

  14. Status: Closed - Implemented

    Comments: On August 7, 2009 the Assistant Chief Counsel for Advocacy described actions that the Office has taken, within its own authority, to consolidate existing review requirements to maximize the effectiveness and transparency of all retrospective rule reviews. Specifically, the Office incorporated language into its guidance and training to federal agencies on several aspects of section 610 review requirements such as the timing, scope, purpose, and required elements of a periodic rule review, as well as when other retrospective reviews can be considered functionally equivalent to a section 610 review. This guidance was developed to reduce duplication in agency review activities, and improve the transparency of the review process.

    Recommendation: 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 should 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.

    Agency Affected: Small Business Administration: Office of Advocacy

 

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