Order Code RL32397
CRS Report for Congress
Received through the CRS Web
Federal Rulemaking:
The Role of the Office of Information
and Regulatory Affairs
Updated May 28, 2004
Curtis W. Copeland
Specialist in American National Government
Government and Finance Division
Congressional Research Service ˜ The Library of Congress

Federal Rulemaking: The Role of the Office of
Information and Regulatory Affairs
Summary

The Paperwork Reduction Act of 1980 created the Office of Information and
Regulatory Affairs (OIRA) within the Office of Management and Budget (OMB).
Executive Order 12291, issued by President Reagan in 1981, gave OIRA the
responsibility to review the substance of agencies’ regulatory actions before
publication in the Federal Register. Since then, OIRA has played a significant —
and sometimes determinative — role in the federal rulemaking process. The office’s
regulatory review role was initially highly controversial, and it has been criticized at
different times as being both too active and too passive regarding agencies’ rules.
Although OIRA has a number of specific statutory responsibilities (e.g., paperwork
review and regulatory accounting), as a component of OMB it is part of the
Executive Office of the President, and helps ensure that covered agencies’ rules
reflect the President’s policies and priorities.
OIRA’s current regulatory review responsibilities are detailed in Executive
Order 12866, which was issued by President Clinton in 1993. The office reviews
significant draft rules from agencies (other than independent regulatory agencies) at
both the proposed and final rulemaking stages, and also informally reviews certain
rules before they are formally submitted. For rules that are economically significant
(most commonly defined as those having a $100 million impact on the economy),
OIRA also reviews the economic analyses. Since 1994, OIRA has reviewed between
500 and 700 significant proposed and final rules each year, and can clear the rules
with or without changes, return the rules to the agencies for reconsideration, or
encourage the agencies to withdraw them. The executive order also requires OIRA
or the rulemaking agencies to disclose certain elements of the review process to the
public, including the changes made at OIRA’s recommendation.
A September 2003 report by the General Accounting Office indicated that OIRA
had a significant effect on more than a third of the 85 rules in the study, but OIRA’s
most common effect was to suggest changes to explanatory language in the
preambles to the rules. The current administrator of OIRA has made a number of
changes since taking office in July 2001, including increased use of return letters,
added emphasis on economic analysis to support the rules, and improvements in the
transparency of the office’s review process. Overall, in contrast to the “counselor”
role it played during the Clinton Administration, OIRA appears to have returned to
the “gatekeeper” role that it had during its first 12 years of existence. Possible
legislative issues involving OIRA include codification of the office’s review function
and principles, increasing or decreasing the office’s funding and staffing, adding
review of rules from independent regulatory agencies, and improvements in the
transparency of OIRA’s review process.
This report will be updated if there are changes in OIRA’s regulatory review
responsibilities. For information on the federal rulemaking process, see CRS Report
RL32240, The Federal Rulemaking Process: An Overview, by Curtis W. Copeland.
For information on other regulatory reforms initiated in recent decades, see CRS
Report RL32356, Federal Regulatory Reform: An Overview, by Curtis W. Copeland.

Contents
The Establishment of Regulatory Review in OIRA . . . . . . . . . . . . . . . . . . . . . . . . 2
OIRA and Reagan Executive Orders on Regulatory Review . . . . . . . . . . . . . 3
Comparison to Previous Regulatory Review Efforts . . . . . . . . . . . . . . . . . . 5
Early Views Regarding OIRA Reviews . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
OIRA and the George H. W. Bush Administration . . . . . . . . . . . . . . . . . . . . 9
Regulatory Review Under Executive Order 12866 . . . . . . . . . . . . . . . . . . . . . . . 10
Specific Provisions in the Executive Order . . . . . . . . . . . . . . . . . . . . . . . . . 11
OIRA’s Formal Review Process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
OIRA’s Informal Reviews . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Effects of OIRA’s Reviews . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
GAO’s Analysis of OIRA’s Effects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
OIRA’s Impact on Rules . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Regulated Entities’ Contacts With OIRA . . . . . . . . . . . . . . . . . . . . . . 20
Changes in OIRA’s Policies and Practices During the George W. Bush
Administration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Return of the “Gatekeeper” Role . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
Increased Use of Return Letters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
Advent of Prompt Letters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Increased Emphasis on Economic Analysis . . . . . . . . . . . . . . . . . . . . . . . . . 22
Increased Transparency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Changes in OIRA Staffing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
OIRA’s Other Responsibilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
OIRA and the Future of
Presidential Regulatory Review . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Possible Legislative Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Statutory Authority for Regulatory Review . . . . . . . . . . . . . . . . . . . . . 29
Funding and Staffing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Addition of Independent Agencies’ Rules . . . . . . . . . . . . . . . . . . . . . . 30
Transparency of Reviews . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
List of Figures
Figure 1. The Number of Rules That OIRA Reviewed Dropped Under Executive
Order 12866, Issued in 1993 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Figure 2. OIRA Reviews Draft Proposed and Final Rules . . . . . . . . . . . . . . 13
List of Tables
Table 1: Most Rules That OIRA Reviewed Were Coded in Database as Changed or
Not Changed . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

Federal Rulemaking: The Role of the Office
of Information and Regulatory Affairs
The Office of Information and Regulatory Affairs (OIRA) is one of several
statutory offices within the Office of Management and Budget (OMB),1 and can play
a significant — if not determinative — role in the rulemaking process for most
federal agencies. In addition to its many other responsibilities, OIRA currently
reviews the substance of between 500 and 700 significant proposed and final rules
each year before agencies publish them in the Federal Register,2 and can clear the
rules with or without change, return them to the agencies for reconsideration, or
encourage the agencies to withdraw the rules. About 100 of the rules that OIRA
reviews each year are each considered “economically significant” or “major” (e.g.,
have a $100 million impact on the economy). The office was created by Congress
and has a number of specific statutory responsibilities, but also helps ensure that
agencies’ rules reflect the President’s policies and priorities.
OIRA’s role in the federal rulemaking process has been highly controversial in
all four of the presidential administrations in which it has been in existence, but some
of the criticisms directed at the office have varied over time. In some
administrations, OIRA has been accused of controlling the agenda of the rulemaking
agencies too much, directing them to change substantive provisions in draft rules or
even stopping proposed regulatory actions that it believes are poorly crafted or
unnecessary. At other times, though, OIRA has been accused of not exerting enough
authority over the agencies’ rules. Other, more persistent criticisms have focused on
the lack of transparency of OIRA’s regulatory reviews to the public and the
sometimes unseen influence that regulated entities and other nongovernmental
organizations can have on agencies’ rules through those reviews.
This report describes how OIRA reviews covered agencies’ draft rules, OIRA’s
effects on the rules, and changes in OIRA’s procedures and policies in recent years.
Much of that discussion is drawn from a September 2003 report on OIRA by the
1 The other statutory offices, which are collectively referred to as the “management” side
of OMB, are the Office of Federal Financial Management, the Office of Federal
Procurement Policy, and the Office of Electronic Government and Information Technology.
OMB’s resource management offices, which review agencies’ budget submissions, are
sometimes collectively referred to as OMB’s “budget” side.
2 The Administrative Procedure Act of 1946 (5 U.S.C. 551 et seq.). generally requires
agencies to publish a notice of proposed rulemaking in the Federal Register, permit the
public to comment on the proposed rule, and then publish a final rule addressing the
comments provided. For an overview of many of the statutes and executive orders
governing federal rulemaking, see CRS Report RL32240, The Federal Rulemaking Process:
An Overview
, by Curtis W. Copeland.

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General Accounting Office (GAO).3 First, though, this report will provide a brief
history of presidential regulatory review and describe how OIRA’s review process
was established. Finally, the report describes several potential legislative issues
regarding OIRA’s regulatory review authority.
The Establishment of Regulatory Review in OIRA
OIRA was created within OMB by Section 3503 of the Paperwork Reduction
Act (PRA) of 1980 (44 U.S.C. Chapter 35).4 The PRA provided that OIRA would
be headed by an administrator, and designated the OIRA administrator as the
“principal advisor to the Director on Federal information policy.” The act also said
that the Director of OMB “shall delegate to the (OIRA) Administrator the authority
to administer all functions under this chapter.” Specific areas of responsibility in the
PRA that were assigned to the Director (and later delegated to OIRA) included
information policy, information collection request clearance and paperwork control,
statistical policy and coordination, records management, privacy, and automatic data
processing and telecommunications.5 With regard to paperwork reduction, the act
generally prohibited agencies from conducting or sponsoring a collection of
information until they had submitted their proposed information collection requests
to OIRA and the office had approved those requests. The PRA’s requirements cover
rules issued by virtually all agencies, including Cabinet departments, independent
agencies, and independent regulatory agencies and commissions.6
Although the PRA gave OIRA substantive responsibilities in many areas, the
bulk of the office’s day-to-day activities under the act were initially focused on
reviewing and approving agencies’ proposed information collection requests. OIRA
had 77 staff members when the PRA took effect in 1981, of which about half were
involved in reviewing agencies’ information collection requests. That year, OIRA
took nearly 5,000 paperwork review actions — approving new and revised
collections, extending existing collections, and reinstating expired collections. The
office’s paperwork clearance workload since then has generally been between 4,000
and 6,000 actions each year, although the number of OIRA staff overall and those
3 U.S. General Accounting Office, Rulemaking: OMB’s Role in Reviews of Agencies’ Draft
Rules and the Transparency of Those Reviews
, GAO-03-929, Sept. 22, 2003.
4 For a discussion of the PRA, see CRS Report RL30590, Paperwork Reduction Act
Reauthorization and Government Information Management Issues
, by Harold Relyea.
5 The PRA was later amended in 1986 and again in 1995, and the list of OIRA’s duties
changed somewhat. For example, the 1986 amendments sharpened the management focus
of the act and changed “information policy” to “information resources management.” As
discussed later in this report, the 1986 amendment also required the administrator of OIRA
to be appointed by the President, subject to advice and consent of the Senate.
6 As used in this report, the term “independent regulatory agencies” refers to agencies
established to be independent of the President, including the Federal Communications
Commission, the Securities and Exchange Commission, and the Consumer Product Safety
Commission. The term “independent agencies” refers to agencies that are independent of
Cabinet departments but not independent regulatory agencies (e.g., the Environmental
Protection Agency and the Office of Personnel Management).

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reviewing proposed collections has declined substantially.7 Although many federal
regulations have an information collection component, the PRA did not authorize
OIRA to review or comment on the non-paperwork elements of those regulations, or
on regulations without an information collection component.8
OIRA and Reagan Executive Orders on Regulatory Review
In 1980, President Reagan was elected on a platform critical of government’s
role in society in general and of federal regulations in particular. Shortly after taking
office, he established a “Presidential Task Force on Regulatory Relief,” headed by
Vice President George H. W. Bush and composed of Cabinet officers (although the
bulk of the task force’s work was reportedly performed by OMB staff). The task
force’s responsibilities included (1) monitoring the establishment of OMB’s
responsibility to coordinate and review new rules, (2) the development of legislative
changes to regulatory statutes, and (3) the revision of existing regulations. In relation
to this last responsibility, the task force ultimately identified a total of 119 rules for
alteration or cancellation by the issuing agencies, nearly half of which had been
issued by the Department of Transportation or the Environmental Protection Agency.
Although the task force said that implementation of the changes it recommended
would save more than $150 billion over the next 10 years, critics charged that this
estimate ignored the benefits associated with the rules on what they referred to as the
administration’s regulatory “hit list.” The task force’s legislative efforts were less
successful, failing to get Congress to enact revisions to clean air and water laws or
to enact broad regulatory reform legislation that would have limited agencies’
rulemaking powers.9
In February 1981 — less than one month after taking office — President Reagan
issued Executive Order 1229110 on “Federal Regulation,” which greatly increased
both the scope and importance of OIRA’s responsibilities.11 Specifically, the
executive order generally required covered agencies (Cabinet departments and
independent agencies, but not independent regulatory agencies) to:
7 For example, by 1989, OIRA’s overall staffing had declined to fewer than 60 employees,
of whom OIRA estimated 35 were reviewing information collection requests. By 1997,
OIRA staffing declined 48 employees, of whom 22 were reviewing paperwork requests. See
U.S. General Accounting Office, Regulatory Management: Implementation of Selected
OMB Responsibilities Under the Paperwork Reduction Act
, GAO/GGD-98-120, July 9,
1998.
8 In some cases, though, the paperwork requirement may be the essence of the regulation.
For example, EPA’s Toxics Release Inventory (TRI) program is essentially a database
created through collections of information imposed on businesses in order to inform the
public about chemical hazards in their communities.
9 The task force was disbanded in August 1983 after issuing a final report.
10 Executive Order 12291, “Federal Regulation,” 46 Federal Register 13193, Feb. 19, 1981.
11 For a description of the effects of this order, see Erik D. Olson, “The Quiet Shift of
Power: Office of Management & Budget Supervision of Environmental Protection Agency
Rulemaking Under Executive Order 12291,” Virginia Journal of Natural Resources Law,
vol. 4 (Fall 1984), pp. 1-80.

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! refrain from taking regulatory action “unless the potential benefits
to society for the regulation outweigh the potential costs to society,”
select regulatory objectives to maximize net benefits to society, and
select the regulatory alternative that involves the least net cost to
society;
! prepare a “regulatory impact analysis” for each “major” rule, which
was defined as any regulation likely to result in (among other things)
an annual effect on the economy of $100 million. Those analyses
were required to contain a description of the potential benefits and
costs of the rule, a description of alternative approaches that could
achieve the regulatory goal at lower cost (and why they weren’t
selected), and a determination of the net benefits of the rule. The
issuing agency was to make the initial determination of whether a
rule was “major,” but the executive order gave OMB the authority
to require a rule to be considered major; and
! send a copy of each draft proposed and final rule to OMB before
publication in the Federal Register. The order authorized OMB to
review “any preliminary or final regulatory impact analysis, notice
of proposed rulemaking, or final rule based on the requirements of
this Order.” Non-major rules were required to be submitted to OMB
at least 10 days before publication, but major rules had to be
submitted as much as 60 days in advance.
Executive Order 12291 authorized the director of OMB to review any draft
proposed or final rule or regulatory impact analysis “based on the requirements of
this Order.” The executive order indicated that the review should be completed
within 60 days, but allowed the director to extend that period whenever necessary.
It also authorized the director to exempt classes of regulations from any or all of the
order’s requirements,12 and generally required agencies to “refrain” from publishing
any final rules until they had responded to OMB’s comments. The executive order
made OMB’s authority to review agencies’ draft rules subject to the overall direction
of the presidential task force on regulatory relief.13
Although the executive order did not specifically mention OIRA, shortly after
its issuance the Reagan Administration decided to integrate OMB’s regulatory
review responsibilities under the executive order with the responsibilities given to
OMB (and ultimately to OIRA) by the PRA. As a result, OIRA’s responsibilities for
12 The exemptions that OMB granted fell into four broad categories: (1) rules that were
essentially nonregulatory in nature, (2) rules that delegated regulatory authority to the States,
(3) rules that generally affected individual entities and that did not involve broader policy
issues, and (4) rules for which a delay of even a few days could have imposed substantial
costs and that were unlikely to involve significant policy issues. OMB granted about 30
exemptions, most of which were established in 1981 or 1982.
13 Although the task force was chaired by Vice President Bush, the executive director was
the administrator of OIRA. Other members included the Director of OMB, the Attorney
General, and the Secretaries of Commerce, Labor, and the Treasury.

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substantive review of rules under the executive order were added to the office’s
substantial responsibilities under the PRA. In 1981, OIRA reviewed the substance
of nearly 2,800 rules under Executive Order 12291 — in addition to the nearly 5,000
paperwork review actions it took that year.
In 1985, President Reagan extended OIRA’s influence over rulemaking even
further by issuing Executive Order 12498, which required Cabinet department and
independent agencies (but not independent regulatory agencies) to submit a
“regulatory program” to OMB for review each year that covered all of their
significant regulatory actions underway or planned.14 Previously, Executive Order
12291 required each of those agencies to publish semiannual “regulatory agendas”
of proposed regulations that the agency “has issued or expects to issue,” and any
existing rule that was under review.15 These agendas were required to contain a
schedule for completing action on any major rule for which the agency had published
a notice of proposed rulemaking. The new executive order went further, saying that,
except in “unusual circumstances,” OMB could return any rule submitted for review
under Executive Order 12291 to the issuing agency for “reconsideration” if it was not
in the agency’s regulatory program for that year, or was “materially different” from
what was described in the program.
In other words, OIRA could return a draft rule to an issuing agency if the office
did not have advance notice of the rule’s submission, even if the rule was otherwise
consistent with the requirements in Executive Order 12291.16 The regulatory agenda
and program requirements in these executive orders also permitted OIRA to become
aware of forthcoming agency actions well in advance of the submission of a draft
proposed rule, thereby permitting the office to stop or alter an objectionable rule
before the rulemaking process developed momentum. Although Reagan
Administration officials compared this planning process to the process used to
develop the President’s budget, critics noted that the budget process has a final step
that the regulatory process lacks — review and approval by Congress.
Comparison to Previous Regulatory Review Efforts
The establishment of this regulatory review function within OIRA was a
significant development both in the office’s history and in the overall movement to
reform the federal regulatory process. In another sense, though, Executive Orders
12291 and 12498 represented the continuation of presidential review of rules, not the
start of such reviews. Some form of centralized review of agencies’ regulations
within the Executive Office of the President has been part of the rulemaking process
since the early 1970's. For example:
14 Executive Order 12498, “Regulatory Planning Process,” 50 Federal Register 1036, Jan.
8, 1985.
15 As discussed later in this report, President Carter first required the use of these agendas
in 1978.
16 An OIRA representative said that although the office had this authority it never used it,
noting that would have been difficult to defend the return of an agency’s rule for purely
procedural reasons.

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! In 1971, President Nixon established a “Quality of Life Review”
program in which executive departments and independent agencies
submitted all “significant” draft proposed and final rules pertaining
to “environmental quality, consumer protection, and occupational
and public health and safety” to OMB, which then circulated them
to other agencies for comment.17 In their submissions, agencies were
to provide a summary of their proposals, including their principal
objectives, the alternatives that they considered, and a comparison
of the expected benefits and cost of those alternatives. Agencies
were also required to submit a schedule showing estimated dates of
proposed and final significant rules.
! In 1974, President Ford issued Executive Order 11821, which
required agencies to prepare an “inflation impact statement” for each
“major” proposed rule.18 The statement was a certification that the
inflationary impact of the rule had been evaluated in accordance with
criteria and procedures developed by OMB. The executive order
directed OMB to develop criteria for the identification of major rules
that may have a significant impact on inflation, but specified that the
office must consider costs, effects on productivity, effects on
competition, and effects on supplies of important products and
services. Before a major rule was published in the Federal Register,
the issuing agency was required to submit the associated impact
statement to the Council on Wage and Price Stability (CWPS).
CWPS would then either provide comments directly to the agency
or participate in the regular rulemaking comment process.
! In 1978, President Carter issued Executive Order 12044, which
(among other things) required agencies to publish semiannual
agendas of any significant rules under development or review, and
to prepare a regulatory analysis for at least all rules with a $100
million impact on the economy.19 The analysis was to contain a
succinct statement of the problem, a description of the alternative
approaches considered, and the “economic consequences” of those
alternatives. OMB was instructed to “assure the effective
implementation of this Order,” but was not given specific review
responsibilities. President Carter also established (1) a “Regulatory
Analysis Review Group” (RARG) to review the analyses prepared
for certain major rules and to submit comments during the comment
period, and (2) a “Regulatory Council” to coordinate agencies’
actions to avoid conflicting requirements and duplication of effort.
17 This requirement was formally established through an October 1971 memorandum from
then-OMB Director George Schultz. According to some observers, the requirements were
routinely imposed only on the Environmental Protection Agency.
18 Executive Order 11821, “Inflation Impact Statements,” 39 Federal Register 41501, Nov.
29, 1974. The order also required such statements for agency-proposed major legislation.
19 Executive Order 12044, “Improving Government Regulations,” 43 Federal Register
12661, Mar. 24, 1978.

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In several ways, though, the analytical and review requirements in Executive
Order 12291 were significantly different from these previous efforts. For example,
the requirement in the new executive order that agencies choose the least costly
approach to a particular regulatory objective went further than the requirement in
President Carter’s Executive Order 12044, which simply required agencies to analyze
and consider alternative regulatory approaches. Also, whereas the regulatory
oversight functions were divided among many offices (OMB, CWPS, RARG, and
the regulatory council) during the Carter Administration, Executive Order 12291
consolidated these functions within OIRA.20 Another major difference was the
amount of influence that OIRA had compared to its predecessors. Under previous
executive orders, CWPS and RARG had primarily an advisory role. In contrast,
under Executive Order 12291, OIRA could overrule agency determinations regarding
whether the rule was “major” (and therefore required a regulatory impact analysis),
and could delay the regulation until the agency had adequately responded to its
concerns (e.g., if it believed the agency had not considered all reasonable alternatives,
that its analysis was not sound, or that it was contrary to administration policy).
OIRA’s significant influence on rulemaking was underscored by its organizational
position within OMB — the agency that reviews and approves the rulemaking
agencies’ budget requests. Finally, and perhaps most importantly, the nature and
transparency of the review process was significantly different under Executive Order
12291. Under the Carter Administration’s approach, RARG and CWPS prepared and
filed comments on agencies’ regulatory proposals during the formal public comment
period, after they were published in the Federal Register. In the case of RARG
filings, a draft of the comments was circulated to all RARG members, and the
comments and any dissents were placed on the public record at the close of the
comment period. In contrast, OIRA’s reviews occurred before the rules were
published for comment, and Executive Order 12291 did not require that OIRA’s
comments on the draft rule be disclosed. This pre-publication review process made
OIRA’s regulatory reviews under Executive Order 12291 qualitatively different than
its predecessors.
Early Views Regarding OIRA Reviews
The expansion of OIRA’s authority in the rulemaking process via Executive
Orders 12291 and 12498 was highly controversial. Although some believed that the
authority did not go far enough (e.g., did not cover independent regulatory agencies),
most of the concerns were that the expansion had gone too far. For example, a
number of the concerns raised by Members of Congress, public interest groups, and
others focused on whether OIRA’s role violated the constitutional separation of
powers and the effect that OIRA’s review had on public participation and the
timeliness of agencies’ rules.21 Some believed that OIRA’s new authority displaced
20 George Eads, “Harnessing Regulation: The Evolving Role of White House Oversight,”
Regulation, vol. 5 (May/June 1981), pp. 19-26.
21 U.S. Congress, House Committee on Energy and Commerce, Subcommittee on Oversight
and Investigations, Role of OMB in Regulation, 97th Cong., 1st sess., June 18, 1981
(Washington: GPO, 1981). See also Morton Rosenberg, “Beyond the Limits of Executive
(continued...)

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the discretionary authority of agency decision makers in violation of congressional
delegations of rulemaking authority, and that the President exceeded his authority in
issuing the executive orders. Others indicated that OIRA did not have the technical
expertise needed to instruct agencies about the content of their rules. Still other
concerns focused on OIRA’s ability to carry out its many responsibilities. In 1983,
GAO concluded that the expansion of OIRA’s responsibilities under Executive Order
12291 had adversely affected the office’s ability to carry out its PRA responsibilities,
and recommended that Congress consider amending the act to prohibit OIRA from
carrying out other responsibilities like regulatory review.22
Many of the early concerns about OIRA focused on the lack of transparency of
the regulatory reviews, and specifically questioned whether OIRA had become a
clandestine conduit for outside influence in the rulemaking process. Critics pointed
out that in the first few months after the executive order was issued, OIRA met with
representatives from dozens of businesses and associations seeking regulatory relief
and returned dozens of rules to the agencies for reconsideration.23 In response to
these concerns, the OMB Director issued a memorandum in June 1981 stating that
any factual material provided to OIRA regarding proposed rules should also be sent
to the relevant rulemaking agency. The memorandum did not, however, apply to
information provided to OIRA orally, and did not require that OIRA’s meetings with
outside parties be disclosed to the public.
OIRA’s role in the rulemaking process remained controversial for the next
several years. In 1983, Congress was so dissatisfied with OIRA’s performance in the
areas of regulatory and paperwork review that it permitted the office’s appropriation
authority to expire (although the office’s statutory authority under the PRA was not
affected and it continued to receive an appropriation via OMB).24 In 1985, five
House committee chairmen filed a friend-of-the-court brief in a lawsuit brought
against the Department of Labor regarding the department’s decision (reportedly at
the behest of OMB) not to pursue a proposed standard concerning exposure to
ethylene oxide, a sterilizing chemical widely used in hospitals and suspected of
causing cancer. The chairmen claimed that OMB’s actions represented a usurpation
of congressional authority.
Congress reauthorized OIRA in 1986, but only after making the administrator
subject to Senate confirmation. By 1986, Congress began considering legislation to
restrict OIRA’s regulatory review role and to block OIRA’s budget request. In an
21 (...continued)
Power: Presidential Control of Agency Rulemaking Under Executive Order 12291,”
Michigan Law Review, vol. 80 (Dec. 1981), pp. 193-247.
22 U.S. General Accounting Office, Implementing the Paperwork Reduction Act: Some
Progress, But Many Problems Remain
, GAO/GGD-83-35, April 20, 1983.
23 Letter from James C. Miller III, administrator of OIRA, to the Honorable John D. Dingell,
Chairman, Subcommittee on Oversight and Investigations, House Committee on Energy and
Commerce, April 28, 1981.
24 OIRA’s authorization for appropriation also expired in 2001, and (as of the date of this
report) has not been reestablished.

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attempt to head off that legislation, in June 1986 the OIRA administrator issued a
memorandum for the heads of departments and agencies subject to Executive Order
12291 describing new OIRA procedures to improve the transparency of the review
process. For example, the memorandum said that only the administrator or the
deputy administrator could communicate with outside parties regarding rules
submitted for review, and that OIRA would make available to the public all written
materials received from outside parties. OIRA also said that it would, upon written
request after a rule had been published, make available all written correspondence
between OIRA and the agency head regarding the draft submitted for review.25
In 1987 the National Academy of Public Administration published a report on
presidential management of agency rulemaking that summarized the criticisms of the
OIRA review process as well as the positions of its proponents.26 The report also
described a number of issues in regulatory review and offered recommendations for
improvement. For example, the report recommended that “regulatory management
be accepted as an essential element of presidential management.” It also
recommended that regulatory agencies “log, summarize, and include in the
rulemaking record all communications from outside parties, OMB, or other executive
or legislative branch officials concerning the merits of proposed regulations.”
In 1988, the Administrative Conference of the United States also examined the
issue of presidential review of agency rulemaking and concluded that the reviews
could improve coordination and resolve conflicts among agencies.27 The
Administrative Conference also said, though, that presidential review “does not
displace responsibilities placed in the agency by law nor authorize the use of factors
not otherwise permitted by law.” The Conference recommended public disclosure
of proposed and final agency rules submitted to OIRA under the executive order,
communications from OMB relating to the substance of rules, and communications
with outside parties, and also recommended that the reviews be completed in a
“timely fashion.”28
OIRA and the George H. W. Bush Administration
President George H. W. Bush continued the implementation of Executive
Orders 12291 and 12498 during his administration, but external events significantly
25 For further information on this policy, see Judith Havemann, “No ‘Shade-Drawn’
Dealings for OMB; Congress Gets Disclosure of Regulation-Review Procedures,”
Washington Post, June 17, 1986, p. A-21.
26 National Academy of Public Administration, Presidential Management of Rulemaking in
Regulatory Agencies
(Jan. 1987).
27 Administrative Conference of the United States, Presidential Review of Agency
Rulemaking,
Conference Recommendation 88-9 (1988). The Administrative Conference
was established in 1968 to provide advice regarding procedural improvements in federal
programs, and was eliminated by Congress in 1995.
28 The National Academy of Public Administration and the American Bar Association have
also recognized the potential value of presidential regulatory review. They also
recommended reforms such as improved transparency and better communication between
OIRA and agency staff.

CRS-10
affected OIRA’s operation and, more generally, the federal rulemaking process. In
1989, President Bush’s nominee to head OIRA was not confirmed. Later, in
response to published accounts that the burden of regulation was once again
increasing, President Bush established the President’s “Council on Competitiveness”
(also known as the Competitiveness Council) to review regulations issued by
agencies. Chaired by Vice President Quayle, the council oversaw and was supported
by OIRA, and reviewed particular rules that it believed would have a significant
impact on the economy or particular industries. According to OIRA representatives,
the council signified continued White House-level interest in the regulatory arena,
and also represented a continuation of the type of role played by the Presidential Task
Force on Regulatory Relief during the Reagan Administration.
Many of the Competitiveness Council’s actions were highly controversial, with
critics assailing both the effects of those actions (e.g., rolling back environmental or
other requirements) and the secrecy in which the council acted.29 The council
attempted to maintain strict secrecy regarding both its deliberations and those in the
private sector with whom it communicated or consulted.30 Critics decried what they
believed to be “backdoor rulemaking” by the Competitiveness Council, but the
council continued its operations until the end of the Bush Administration in 1993.
Meanwhile, OIRA continued its operations under Executive Order 12291, reviewing
between 2,100 and 2,500 rules each year from 1989 through 1992.
Regulatory Review Under Executive Order 12866
In September 1993, President Clinton issued Executive Order 12866 on
“Regulatory Planning and Review,” which revoked Executive Orders 12291 and
12498 and abolished the Council on Competitiveness.31 Although different from its
predecessors in many respects, Executive Order 12866 (which is still in effect)
continued the general framework of presidential review of rulemaking. For example,
it requires covered agencies (again, Cabinet departments and independent agencies
but not independent regulatory agencies) to submit their proposed and final rules to
OMB before publishing them in the Federal Register. The order also requires
agencies to prepare cost-benefit analyses for their “economically significant” rules
(essentially the same as “major” rules under Executive Order 12291). As discussed
in detail below, however, Executive Order 12866 established a somewhat new
regulatory philosophy and a new set of rulemaking principles, limited OIRA’s
reviews to certain types of rules, and established transparency requirements that
included but went beyond those that had been put in place by the administrator’s June
29 Christine Triano and Nancy Watzman, All the Vice President’s Men: How the Quayle
Council on Competitiveness Secretly Undermines Health, Safety, and Environmental
Programs
(Washington: OMB Watch/Public Citizen, 1991).
30 See Bob Woodward and David Broder, “Quayle’s Quest: Curb Rules, Leave ‘No
Fingerprints,” Washington Post, Jan. 9, 1992, p. A1.
31 Executive Order 12866, “Regulatory Planning and Review,” 58 Federal Register 51735,
Oct. 4, 1993. For an electronic copy of this executive order, see
[http://www.whitehouse.gov/omb/inforeg/eo12866.pdf], visited on May 24, 2004.

CRS-11
1986 memorandum. Section 2(b) of the order assigns responsibility for review of
agency rulemaking to OMB, and specifically names OIRA as “the repository of
expertise concerning regulatory issues.” The order also named the Vice President as
principal advisor to the President on regulatory policy, planning, and review.32
Specific Provisions in the Executive Order
In its statement of regulatory philosophy, Executive Order 12866 says, among
other things, that agencies should assess all costs and benefits of available regulatory
alternatives, including both quantitative and qualitative measures. It also provides
that agencies should select regulatory approaches that maximize net benefits (unless
a statute requires another approach). Where permissible and applicable, the order
states that agencies should adhere to a set of principles when developing rules,
including (1) consideration of the degree and nature of risk posed when setting
regulatory priorities, (2) adoption of regulations only upon a “reasoned determination
that the benefits of the intended regulation justify its costs,” and (3) tailoring
regulations to impose the least burden on society needed to achieve the regulatory
objectives. Some of the stated objectives of the order are “to reaffirm the primacy
of Federal agencies in the regulatory decision-making process; to restore the integrity
and legitimacy of regulatory review and oversight; and to make the process more
accessible and open to the public.” According to OIRA representatives, the
“primacy” of the agencies provision signaled a significant change in regulatory
philosophy, vesting greater control of the rulemaking process with regulatory
agencies and taking away authority from OIRA. Also, the requirement that the
benefits of a regulation “justify” its costs was a noticeably lower threshold than the
requirement in Executive Order 12291 that the benefits “outweigh” the costs.
Section 6 of Executive Order 12866 established agency and OIRA
responsibilities in the centralized review of regulations. In contrast to the broad
scope of review under Executive Order 12291, the new order limited OIRA reviews
to actions identified by the rulemaking agency or OIRA as “significant” regulatory
actions, which are defined in section 2(f) of the order as the following:
“Any regulatory action that is likely to result in a rule that may (1)
have an annual effect on the economy of $100 million or more or
adversely affect in a material way the economy, a sector of the
economy, productivity, competition, jobs, the environment, public
health or safety, or State, local, or tribal governments or communities;
(2) create a serious inconsistency or otherwise interfere with an action
taken or planned by another agency; (3) materially alter the budgetary
impact of entitlements, grants, user fees, or loan programs or the
rights and obligations of recipients thereof; or (4) raise novel legal or
policy issues arising out of legal mandates, the President’s priorities,
or the principles set forth in the Executive order.”
32 Executive Order 13258, issued in February 2002, amended Executive Order 12866 and
reassigned all roles originally assigned to the Vice President to the President’s chief of staff.
For a copy of this executive order, see
[http://www.whitehouse.gov/omb/inforeg/eo13258.pdf], visited on May 24, 2004.

CRS-12
As Figure 1 shows, by focusing OIRA’s reviews on significant rules, the number of
draft proposed and final rules that OIRA examined fell from between 2,000 and
3,000 per year under the Executive Order 12291 to between 500 and about 700 rules
per year under Executive Order 12866.
Figure 1. The Number of Rules That OIRA Reviewed Dropped
Under Executive Order 12866, Issued in 1993
Number of Rules
3000
2,790
2,524
2,483
2500
2,315
2,220
2,167
2000
2,213
1500
1000
700
712
587
620
505
500
487
0
1981
1983
1985
1987
1989
1991
1993
1995
1997
1999
2001
2003
Year
Source: CRS
Executive Order 12866 also differs from its predecessors in other respects. For
example, the order generally requires that OIRA complete its review of proposed and
final rules within 90 calendar days, and requires both the agencies and OIRA to
disclose certain information about how the regulatory reviews were conducted.
Specifically, agencies are required to identify for the public (1) the substantive
changes made to rules between the draft submitted to OIRA for review and the action
subsequently announced and (2) changes made at the suggestion or recommendation
of OIRA. OIRA is required to provide agencies with a copy of all written
communications between OIRA personnel and parties outside of the executive
branch, and a list of the dates and names of individuals involved in substantive oral
communications. The order also instructs OIRA to maintain a public log of all
regulatory actions under review and of all of the above-mentioned documents
provided to the agencies.33
OIRA’s Formal Review Process. As figure 2 shows, OIRA reviews
agencies’ draft rules at both the proposed and final stages of rulemaking.34 In each
33 For a discussion of the differences between the transparency requirements under
Executive Order 12291 and Executive Order 12866, see William D. Araiza, “Judicial and
Legislative Checks on Ex Parte OMB Influence Over Rulemaking,” Administrative Law
Review
, 54 (Spring 2002), 611-630, and Peter M. Shane, “Political Accountability in a
System of Checks and Balances: The Case of Presidential Review of Rulemaking,”
Arkansas Law Review, 48 (1995), 161-214.
34 OIRA may also formally or informally review other rulemaking documents before
(continued...)

CRS-13
phase, the review process starts when the rulemaking agency formally submits a
regulatory review package to OIRA consisting of the rule, any supporting materials,
and a transmittal form. The OIRA docket librarian then logs the receipt of the review
package and forwards it to the appropriate desk officer. In some cases, agencies
withdraw their rules from OIRA during the review period and the rules may or may
not be subsequently resubmitted. At the end of the review period, OIRA either
returns the draft rule to the agency “for reconsideration” or OIRA concludes that the
rule is consistent with the executive order. OIRA codes the rule in its database as
“consistent with change” if there had been any changes to the rule, regardless of the
source or extent of the change. OIRA codes rules in its database as “consistent with
no change”only if they are exactly the same at the end of the review period as the
original submission. If the draft rule is a proposed rule and is judged by OIRA to be
consistent with the executive order, the agency may then publish a notice of proposed
rulemaking in the Federal Register, obtain comments during the specified comment
period, review the comments received, and make any changes to the rule that it
believes are necessary to respond to those comments. (Executive Order 12866 says
that this comment period should, in most cases, be at least 60 days for significant
rules reviewed by OIRA.) If the draft is a final rule, the agency may publish the rule
after OIRA concludes its review and the rule will generally take effect either at that
point or at some later date specified by the agency.
Figure 2. OIRA Reviews Draft Proposed and Final Rules
Source: GAO.
In most of the years since Executive Order 12866 was issued, more than 90%
of the rules that OIRA reviewed were coded in the database as either “consistent with
34 (...continued)
proposed rules (e.g., advance notices of proposed rulemaking).

CRS-14
change” or “consistent without change.” (See Table 1.) Only a small percentage of
rules were withdrawn, and even fewer were returned to the agencies. The proportion
of rules coded as “changed” has varied somewhat over time, but the last several years
of the Clinton Administration (1997 through 2000) were fairly similar to the most
recent non-transition years of the George W. Bush Administration (2002 and 2003).
The data indicate that there were a relatively large number of rules that were
withdrawn and returned in 2001 compared to other years. The withdrawn rules
reflect actions taken at the start of the George W. Bush Administration pursuant to
a memorandum issued by Assistant to the President and Chief of Staff Andrew H.
Card, which generally directed Cabinet departments and independent agencies to (1)
not send proposed or final rules to the Office of the Federal Register, (2) withdraw
from the Office rules that had not yet been published in the Federal Register, and (3)
postpone for 60 days the effective date of rules that had been published but had not
yet taken effect.35 As discussed in greater detail later in this report, OIRA returned
a number of rules to the agencies for reconsideration shortly after a new administrator
was appointed in 2001.
Table 1: Most Rules That OIRA Reviewed Were Coded in
Database as Changed or Not Changed
Percentage of rules OIRA reviewed that were coded:
Year
Consistent
Consistent
Withdrawn
Returned
Other
with change
without change
1994
37.3
53.4
4.3
0.2
4.9
1995
39.0
53.1
5.2
0.5
2.3
1996
51.5
41.4
5.1
0.0
2.0
1997
56.0
37.4
5.1
0.8
0.6
1998
59.3
36.1
3.1
0.0
1.4
1999
62.2
31.5
3.1
0.0
3.2
2000
60.4
34.3
3.9
0.0
1.4
2001
45.6
28.1
22.0
2.6
1.7
2002
54.3
31.7
7.6
0.7
5.6
2003
60.5
30.1
6.9
0.3
2.2
Source: OIRA.
Note: “Other” includes rules that were sent improperly, emergency rules, and rules with a statutory
or judicial deadline. Numbers do not total to 100.0 due to rounding.
35 Executive Office of the President, White House Office, “Regulatory Review Plan,” 66
Federal Register 7702, Jan. 24, 2001. To view a copy of this memorandum, see
[http://www.whitehouse.gov/omb/inforeg/regreview_plan.pdf], visited on May 24, 2004.
For a discussion of the rules whose effective dates were postponed, see U.S. General
Accounting Office, Regulatory Review: Delay of Effective Dates of Final Rules Subject to
the Administration’s Jan. 20, 2001, Memorandum
, GAO-02-370R, Feb. 2002.

CRS-15
The type of review that OIRA conducts under Executive Order 12866
sometimes depends on the type of draft rule submitted. For example, if the draft rule
contains a collection of information covered by the PRA, the desk officer would also
review it for compliance with that act. If the draft rule is “economically significant”
(e.g., has an annual impact on the economy of at least $100 million), the executive
order requires agencies to prepare an economic analysis describing, among other
things, the alternatives that the agency considered and the costs and benefits of those
alternatives.36 For those economically significant rules, OIRA desk officers are to
review the economic analyses using the office’s guidance on how to prepare
regulatory analyses under the executive order.37
An attachment to a September 20, 2001, memorandum to the President’s
Management Council described the general principles and procedures that OIRA
reportedly uses in the implementation of Executive Order 12866.38 For example, the
attachment indicated that the office would, where appropriate, (1) include an
evaluation of whether the agency has conducted an adequate risk assessment, (2) give
“a measure of deference” to regulatory impact analyses and other supporting
technical documents that have been peer reviewed in accordance with specified
procedures, (3) ensure that regulatory clearance packages satisfy the requirements in
other executive orders (e.g., include the certifications required by Executive Order
13132 on “Federalism” and Executive Order 13175 on “Consultation and
Coordination with Indian and Tribal Governments”), (4) consult with the Small
Business Administration (SBA) and the SBA Chief Counsel for Advocacy, and (5)
ensure that agencies evaluate the possible impact of the draft rule on the programs
of other federal agencies.
There is usually some type of communication during the review process (often
via e-mail or telephone) between the OIRA desk officer and the rulemaking agency
regarding specific issues in the draft rule. Briefings and meetings are sometimes held
between OIRA and the agency during the review process, with OIRA branch chiefs,
the deputy administrator, or the administrator involved in some of these meetings.
According to OIRA representatives, the desk officers always consult with the
resource management officers on the budget side of OMB as part of their reviews,
and reviews of draft rules are not completed until those resource management
officers sign off. If the draft rule is economically significant, the desk officer would
also consult with a government economist to help review the required economic
analysis. For other rules the desk officer might consult with other OIRA staff on
issues involving statistics and surveys, information technology and systems, or
36 Section 3(f) of the executive order also defines an economically significant rule as
adversely affecting “in a material way, the economy, a sector of the economy, productivity,
competition, jobs, the environment, public health or safety, or State, local, or tribal
governments or communities.”
37 This guidance was issued as OMB Circular A-4 in September 2003. For a copy of this
guidance, see [http://www.whitehouse.gov/omb/circulars/a004/a-4.pdf.], visited on May 24,
2004.
38 For a copy of this September 20, 2001 memorandum and the attachment, see
[http://www.whitehouse.gov/omb/inforeg/oira_review-process.html], visited on May 24,
2004.

CRS-16
privacy issues. In certain cases, OIRA may circulate a draft rule to other parts of the
Executive Office of the President (e.g., the Office of Science and Technology Policy
or the Council on Environmental Quality) or other agencies (e.g. the Departments of
Energy, the Interior, or Transportation for certain Environmental Protection Agency
rules).
Executive Order 12866 requires OIRA to complete its regulatory reviews within
certain time frames—(1) within 10 working days of submission for any preliminary
actions prior to a notice of proposed rulemaking (e.g., a notice of inquiry or an
advance notice of proposed rulemaking) or (2) within 90 calendar days of submission
for all other regulatory actions (or 45 days if OIRA had previously reviewed the
material). In some instances, however, agency officials said OIRA will ask the
rulemaking agency to withdraw the rule and resubmit it, restarting the review period.
The executive order does not permit OIRA to “approve” or “disapprove” a draft rule;
it is up to the agency to decide whether to proceed with publication of a rule after it
had been returned, or to accept OIRA’s suggested changes. OIRA representatives
said it is often an iterative process in which the agencies and OIRA negotiate issues
and clarify terms. Nevertheless, agencies very rarely publish rules that OIRA returns
or ignore substantive OIRA “suggestions.” In some instances, agency officials will
formally or informally appeal OIRA determinations to the White House.
OIRA’s Informal Reviews. Figure 2 also shows that, for some rules, there
is an additional phase of “informal review” before the rule is officially submitted to
OIRA. In its December 2001 report on the costs and benefits of federal regulations,
OIRA stated that the office’s original review process “was designed as an end-of-the-
pipeline check against poorly conceived regulations.”39 OIRA also said, however,
that by the time an agency formally submits a rule to OIRA for review there may be
“strong institutional momentum” behind the proposal and, as a result, the agency may
be reluctant to address certain issues that OIRA analysts might raise. Therefore,
OIRA indicated “there is value in promoting a role for OIRA’s analytic perspective
earlier in the process, before the agency becomes too entrenched.” OIRA went on
to state the following:
“A common yet informal practice is for agencies to share preliminary
drafts of rules and/or analyses with OIRA desk officers prior to
formal decision making at the agency. This practice is useful for
agencies since they have the opportunity to educate OIRA desk
officers in a more patient way, before the formal 90-day review clock
at OMB begins to tick. The practice is also useful for OIRA analysts
because they have the opportunity to flag serious problems early
enough to facilitate correction before the agency’s position is
irreversible.”
OIRA cannot informally review each of the hundreds of significant proposed
and final rules that are submitted to the office each year. Informal reviews are most
39Office of Management and Budget, Making Sense of Regulation: 2001 Report to Congress on the
Cost and Benefits of Regulations and Unfunded Mandates on State, Local and Tribal Entities
, Dec.
2001.

CRS-17
common when there is a statutory or legal deadline for a rule or when the rule is
extremely large and requires discussion with not only OMB but also other federal
agencies. The Environmental Protection Agency (EPA) and the Departments of
Agriculture, Health and Human Services, and Transportation often issue those types
of rules, and therefore are more likely to have their rules reviewed informally before
formal submission.
OIRA has informally reviewed agencies’ draft rules since its review function
was established in 1981, but informal reviews reportedly became more common
when Executive Order 12866 was adopted in 1993 and OIRA’s reviews were focused
on “significant” rules. There have been some indications, though, that OIRA has
increased its use of informal reviews even further in recent years. For example, in
its March 2002 draft report to Congress on the costs and benefits of federal
regulation, OIRA said “agencies are beginning to invite OIRA staff into earlier
phases of regulatory development in order to prevent returns late in the rulemaking
process. It is at these early stages where OIRA’s analytic approach can most improve
on the quality of regulatory analyses and the substance of rules.” Separately, in 2002,
the OIRA administrator said “an increasing number of agencies are becoming more
receptive to early discussions with OMB, at least on highly significant
rulemakings.”40
The administrator has also indicated that agencies’ “receptivity” to informal
reviews may be enhanced by the possibility of a returned rule. For example, in early
2002 he said that OIRA was trying “to create an incentive for agencies to come to us
when they know they have something that in the final analysis is going to be
something we’re going to be looking at carefully. And I think that agencies that wait
until the last minute and then come to us—well, in a sense, they’re rolling the dice.”41
Effects of OIRA’s Reviews
Although a great deal has been written about OIRA’s reviews of agencies’ draft
rules, few studies have systematically tried to determine the extent to which those
reviews result in substantive changes to the rules. One such study (using data prior
to the advent of Executive Order 12988) concluded that OIRA’s reviews resulted in
the rejection of some regulations that would have been economically inefficient, but
did not appear to have improved the cost-effectiveness (e.g., costs-per-life saved) of
many of the rules.42 Other studies have used OIRA’s database showing the number
of rules that were coded as “consistent with change” and “consistent without change”
in an attempt to determine the significance of OIRA’s effects on agencies’ rules and
40 Dr. John D. Graham, remarks prepared for the American Hospital Association, July 17,
2002. For a copy of this speech, see
[http://www.whitehouse.gov/omb/inforeg/graham_ama071702.html], visited on May 24,
2004.
41 Rebecca Adams, “Regulating the Rulemakers: John Graham at OIRA,” CQ Weekly, Feb.
23, 2002, pp. 520-526.
42 Scott Farrow, Improving Regulatory Performance: Does Executive Office Oversight
Matter?
(Pittsburgh: Carnegie Mellon University, July 26, 2000).

CRS-18
whether those effects have changed over time.43 As mentioned previously, however,
the “consistent with change” code includes changes made at the initiation of the
agencies as well as changes suggested by OIRA. Also, the code does not differentiate
between minor editorial changes and changes that radically alter the effect of the rule.
“Returns” and “withdrawals” in OIRA’s database also need careful interpretation.
A return may be for purely administrative reasons, not for substantive OIRA
objections. Conversely, a withdrawal of a rule by an agency may have been initiated
by OIRA. In order to use these data effectively, researchers should examine the
associated documentation in the agencies’ and OIRA’s rulemaking dockets.
GAO’s Analysis of OIRA’s Effects
GAO published such an analysis in September 2003, supplementing information
from OMB’s database with information in the dockets and interviews with agency
officials.44 GAO reported that from July 1, 2001, through June 30, 2002, OIRA
completed 642 reviews of agencies’ draft proposed and final rules. Of these,
! About 33% (214) were coded in the database as “consistent with no
change,” indicating that OIRA considered the rules consistent with
the executive order as submitted.
! About 50% (322) were coded as “consistent with change,” indicating
that the rules had changed after being submitted to OIRA, and that
OIRA subsequently concluded that the rule was consistent with the
executive order’s requirements.
! About 8% (50) were coded as “withdrawn” by the agency.
! About 3% (21) were coded as “returned” to the agency by OIRA.
! About 5% (35) had some other disposition (e.g., “sent improperly,”
“emergency,” or “statutory or judicial deadline”).
In order to make its review manageable, GAO focused on 85 of those rules that
were coded as changed, withdrawn, or returned and that were submitted to OIRA by
nine selected health, safety, or environmental agencies or offices: the Animal and
Plant Health Inspection Service within the Department of Agriculture; the Food and
Drug Administration within the Department of Health and Human Services; the
Occupational Health and Safety Administration within the Department of Labor; the
Federal Aviation Administration (FAA), the Federal Motor Carrier Safety
Administration, and the National Highway Traffic Safety Administration (NHTSA)
with the Department of Transportation (DOT); and the offices of air and radiation,
water, and solid waste and emergency response within EPA. Seventy-one of the 85
43 See, for example, Steven Croley, “White House Review of Agency Rulemaking: An
Empirical Investigation,” University of Chicago Law Review, vol. 70 (Summer 2003), pp.
821-885.
44 U.S. General Accounting Office, Rulemaking: OMB’s Role in Reviews of Agencies’ Draft
Rules and the Transparency of Those Reviews
, GAO-03-929, Sept.2003.

CRS-19
rules had been coded “consistent with change,” nine were coded as “returned,” and
five were coded as “withdrawn.”
OIRA’s Impact on Rules. GAO’s analysis of the underlying documents
indicated that OIRA had a significant effect on at least 25 of the 85 draft rules.
Specifically:
! Of the 71 “changed” rules, GAO concluded that OIRA had
suggested significant changes to 17 of them — changes that affected
the scope, impact, or estimated costs or benefits of the rules as
originally submitted. In general, the focus of OIRA’s suggested
changes appeared to be on reducing regulatory burden (and, in some
cases, the expected benefits as well). Fourteen of the 17
significantly changed rules were from EPA’s office of air and
radiation or its office of water. For example, at OIRA’s
recommendation, EPA removed manganese from a list of hazardous
wastes, deleted certain types of engines from coverage of a rule
setting emissions standards, and delayed the compliance dates for
two other types of emissions. Of the remaining 54 “changed” rules,
the most significant changes made at OIRA’s suggestion involved
adding explanatory language to the preambles of the rules and asking
for comment on particular provisions. In 20 of the 54 rules, OIRA
suggested only minor editorial changes (e.g., correcting spelling
errors or citations) or made no suggestions at all.
! Of the nine rules that had been returned to the agencies by OIRA,
two were returned because they had been improperly submitted, not
because of substantive defect. OIRA returned the remaining seven
rules because of concerns about the agencies’ regulatory analyses or
a perceived lack of coordination between rulemaking agencies. For
example, OIRA returned one EPA rule because the agency did not
provide a quantitative analysis of costs and benefits, and returned a
NHTSA rule because OIRA did not believe that the agency had
demonstrated that it had selected the best available alternative. Five
of the seven rules returned for substantive reasons had been
submitted by the FAA.
! Of the five rules that were withdrawn, GAO determined that only
one had been withdrawn at OIRA’s suggestion. The other four rules
were withdrawn solely at the agencies’ initiative or as a result of a
mutual decision by the agencies and OIRA.
If anything, GAO’s analysis understates the influence that OIRA has on
agencies’ rules because its findings were often limited to the documentation that was
available. If OIRA suggested a change to a rule before it was formally submitted to
OIRA (e.g., during informal review), GAO’s analysis would not reflect those
changes. In fact, the rule might not have even been in the universe of rules that GAO
examined (i.e., those coded as changed, returned, or withdrawn during OIRA’s
formal review). Other forms of OIRA influence may be even more indirect and
harder to document. For example, some agencies have indicated that they do not

CRS-20
even propose certain regulatory provisions because they believe that OIRA would
find them objectionable.
Regulated Entities’ Contacts With OIRA. GAO also reported that
regulated entities directly contacted OIRA either before or during its review process
regarding 11 of the 25 rules that OIRA significantly affected.45 Eight of those 11
cases involved EPA rules, and the nature of the contacts ranged from meetings with
OIRA representatives to letters sent to OIRA. In 7 of the 11 cases, GAO concluded
that what OIRA ultimately recommended to the rulemaking agencies was similar to
what these regulated parties recommended to OIRA — in some cases, using similar
language to that used by the regulated entities. For example, during OIRA’s review
of an EPA rule on identification and listing of hazardous waste, industry
representatives met with and sent letters to OIRA opposing the listing of manganese
as a hazardous waste constituent. (The industry representatives had made essentially
the same argument to EPA during the public comment phase, but EPA did not agree.)
The main focus of OIRA’s comments to EPA at the conclusion of its review was that
final action on listing manganese as a hazardous contaminant should be deferred.
Notwithstanding the congruence between the comments of the regulated entities and
OIRA’s comments, GAO said it was impossible to determine the extent to which this
or other suggestions made by the regulated entities might have influenced OIRA’s
actions, if at all.
Changes in OIRA’s Policies and Practices During
the George W. Bush Administration
The formal process by which OIRA reviews agencies’ draft rules has changed
little since Executive Order 12866 was issued in 1993.46 There have, however, been
several subtle yet notable changes in OIRA policies and practices in recent
years—particularly since the current OIRA administrator took office in July 2001.
In October 2002, the administrator said “the changes we are making at OMB in
pursuit of smarter regulation are not headline grabbers: No far-reaching legislative
initiatives, no rhetoric-laden executive orders, and no campaigns of regulatory relief.
Yet we are making some changes that we believe will have a long-lasting impact on
the regulatory state.”47
45 Environmental and public interest groups also contacted OIRA regarding three of the
rules.
46 There has been only one amendment to Executive Order 12866 since it was issued. As
mentioned earlier in this report, Executive Order 13258 reassigned all roles originally
assigned to the Vice President in Executive Order 12866 (e.g., to be principal advisor to
the President on regulatory policy, planning, and review) to the President’s chief of
staff.
47 John D. Graham, “Presidential Oversight of the Regulatory State: Can It Work?,” speech
at the Heinz School, Carnegie Mellon University, Oct. 4, 2002.

CRS-21
Return of the “Gatekeeper” Role
As noted previously, during the Reagan Administration, OIRA was often
criticized for acting as a regulatory gatekeeper, actively overseeing and
recommending changes to agencies’ rules. During the Clinton Administration,
however, the opposite concerns were expressed. A number of observers criticized
OIRA for not overseeing the actions of the rulemaking agencies more aggressively.
In September 1996, the then-administrator of OIRA testified that “we have
consciously changed the way we relate to the agencies,” and described OIRA’s
relationship with the rulemaking agencies as “collegial” and “constructive.”48 She
also said she agreed with an article that said OIRA functioned during that period
“more as a counselor during the review process than as an enforcer of the executive
order.”49
OIRA during the George W. Bush Administration has returned to the role it had
during the Reagan Administration, even describing itself in an annual report as the
“gatekeeper for new rulemakings.”50 The administrator of OIRA has said one of the
office’s functions is “to protect people from poorly designed rules,” and said OIRA
review is a way to “combat the tunnel vision that plagues the thinking of single-
mission regulators.” He has also compared OIRA’s review of agencies’ rules to
OMB’s role in reviewing agencies’ budget requests. This return to the gatekeeper
perspective of OIRA’s role has implications for an array of OIRA’s functions, and
underlays many of the other changes described below.
Increased Use of Return Letters
As noted previously in table 1, during the Clinton Administration, OIRA only
rarely returned rules to the agencies for reconsideration. Specifically, according to
OIRA’s database, of the more than 4,000 rules that OIRA reviewed from 1994
through 2000, OIRA returned only seven rules to the agencies — three in 1995 and
four in 1997. OIRA administrators during that period said they viewed the use of
return letters as evidence of the failure of the collaborative review process, since
OIRA and the agencies were part of the same presidential Administration.
In contrast, the current OIRA administrator refers to return letters as the office’s
“ultimate weapon,” and views them as a way to make clear that the office is serious
about the review process. In the first eight months after he took office in July 2001,
OIRA returned 21 draft rules to the agencies for reconsideration. DOT had the most
48 U.S. Congress, Senate Committee on Governmental Affairs, Subcommittee on Financial
Management and Accountability, Oversight of Regulatory Review Activities of the Office
of Information and Regulatory Affairs
, 104th Cong., 2nd sess., Sept. 25, 1996 (Washington:
GPO, 1997).
49 William Niskanen, “Clinton’s Regulatory Record: Policies, Process, and Outcomes,”
Regulation, vol. 19 (1996), pp. 27-28.
50 Office of Management and Budget, Stimulating Smarter Regulation: 2002 Report to
Congress on the Costs and Benefits of Federal Regulations and Unfunded Mandates on
State, Local, and Tribal Entities
, December 2002.

CRS-22
rules returned during 2001 and 2002 (eight), followed by the Social Security
Administration (five) and the Department of Veterans Affairs (four).51 The letters
commonly indicated that OIRA returned the rules because of concerns about the
agencies’ analyses (e.g., whether the agencies had considered all reasonable
alternatives or had selected the alternative that would yield the greatest net benefits).
Subsequently, however, the pace of OIRA’s return letters slowed. Although the
average number of rules that OIRA reviewed each month stayed about the same, in
the 26 months from March 2002 until May 2004, OIRA returned a total of five draft
rules to the agencies — a dramatic decline from the 21 returns during the
administrator’s first eight months in office.52 OIRA officials attributed the decline
in return letters to the improved quality of agencies’ regulatory submissions after the
initial flurry of returns.
Advent of Prompt Letters
OIRA has traditionally been a reactive force in the rulemaking process,
commenting on draft proposed and final rules that are generated by the agencies.
Although OIRA occasionally suggested regulatory topics to the agencies during
previous administrations, the practice was relatively uncommon and the discussions
were not made public. In contrast, the current administrator of OIRA has been more
publicly proactive, sending several agencies “prompt letters” (and posting them on
the OIRA website) suggesting that they develop regulations in a particular area or
encouraging the agencies’ ongoing efforts.53 For example, one such letter encouraged
NHTSA to give greater priority to modifying its frontal occupant protection standard,
and another letter suggested that OSHA make the promotion of automatic external
heart defibrillators a higher priority. Other prompt letters recommended that the
agencies better focus certain research or programs. Between September 2001 and
August 2003, OIRA sent a total of 10 prompt letters to regulatory agencies, and
several of the agencies have taken action in response to the letters. As of May 2004,
however, no prompt letters had been sent since August 2003.
Increased Emphasis on Economic Analysis
Although OIRA has always encouraged agencies to provide well-developed
economic analyses for their draft rules, the current administrator has expressed
greater interest in this issue than his predecessors. Also, according to agency
officials, there has been a perceptible “stepping up the bar” in the amount of support
required for their rules, with OIRA reportedly more often looking for regulatory
benefits to be quantified and a cost-benefit analysis for every regulatory option that
the agency considered, not just the option selected.
51 Copies of OIRA’s return letters are available on OMB’s website at
[http://www.whitehouse.gov/omb/inforeg/return_letter.html], visited on May 24, 2004.
52 Two of the five returns during this period involved the same DOT rule.
53 Copies of these prompt letters are available on OMB’s website at
[http://www.whitehouse.gov/omb/inforeg/prompt_letter.html], visited on May 24, 2004.

CRS-23
In September 2003, OIRA published revised guidelines for economic analysis
under the executive order — updating “best practices” guidance issued in January
1996.54 The new guidelines were generally similar to the earlier guidance, but
differed in several key areas — e.g., encouraging agencies to (1) perform both cost-
effectiveness and cost-benefit analyses in support of their major rules,55 (2) use
multiple discount rates when the benefits and costs of rules are expected to occur in
different time periods,56 and (3) use a formal probability analysis of benefits and costs
when a rule is expected to have more than a $1 billion impact on the economy (unless
the effects of the rule are clear).
Increased Transparency
As noted previously, many of the longstanding concerns about OIRA’s role in
the rulemaking process have centered on the perceived lack of transparency of its
reviews. Executive Order 12866 attempted to address some of those concerns,
requiring (among other things) that agencies disclose after the publication of a rule
the changes made to the rule during OIRA’s review and the changes made at the
suggestion or recommendation of OIRA. The executive order requires OIRA to
maintain a publicly available log disclosing the status of all regulatory actions under
review and the names and dates of those involved in substantive oral
communications (e.g., meetings, telephone calls) between OIRA staff and parties
outside of the executive branch. These requirements notwithstanding, concerns about
the lack of transparency continued. For example, even after issuance of the executive
order, OIRA disclosed contacts with outside parties only if they occurred during the
office’s formal review period, not if they occurred during its informal reviews.
In October 2001, the OIRA administrator published a memorandum to OIRA
staff on the office’s website that extended the executive order’s disclosure
requirements in several areas. For example, the memorandum said that OIRA would
disclose substantive meetings and other contacts with outside parties about a rule
under review even if OIRA was only informally reviewing the rule. OIRA also said
it would disclose substantive telephone calls with outside parties that were initiated
by the administrator, not just calls initiated by outside parties. OIRA has also posted
54 As noted earlier in this report, this guidance (OMB Circular A-4) is available at
[http://www.whitehouse.gov/omb/circulars/a004/a-4.pdf.], visited on May 24, 2004.
55 Cost-benefit analysis involves the systematic identification of all costs and benefits
associated with a forthcoming regulation. Cost-effectiveness analysis seeks to determine
how a given goal can be achieved at the least cost. In contrast to cost-benefit analysis, the
concern in cost-effectiveness analysis is not with weighing the merits of the goal, but with
identifying and analyzing the costs of alternatives to reach that goal (e.g., dollars per life
saved).
56 Discounting can have a significant effect on the present value of future health benefits.
For example, in a February 2003 speech the OIRA administrator noted that the present value
of 1,000 lives saved 50 years in the future is only 34 lives in present value when evaluated
at a 7 % discount rate.

CRS-24
on its website lists of regulations currently under review,57 reviews concluded in the
previous 30 days,58 and its contacts with outside parties.59
Changes in OIRA Staffing
When OIRA was created in FY1981, the office had a “full-time equivalent”
(FTE) ceiling of 90 staff members. By 1997, OIRA’s FTE allocation had declined
to 47 — a nearly 50% reduction. Although Executive Order 12866 (issued in late
1993) permitted OIRA to focus its resources on “significant” rules, this decline in
OIRA staffing also occurred during a period in which regulatory agencies’ staffing
and budgetary levels were increasing and OIRA was given a number of new statutory
responsibilities. Specifically, as discussed later in this report, OIRA was expected
to perform various duties under the Unfunded Mandates Reform Act of 1995, the
Small Business Regulatory Enforcement Fairness Act of 1996, and the Regulatory
Right-to-Know Act of 2001.
Starting in 2001, OIRA’s staffing authorization began to increase; by 2002 , it
stood at 55 FTEs. Between 2001 and 2003, OIRA hired five new staff members in
such fields as epidemiology, risk assessment, engineering, and health economics.
OIRA indicated that these new hires reflected the increasing importance of science-
based regulation in federal agencies, and would enable OIRA to ask penetrating
technical questions about agency proposals.
OIRA’s Other Responsibilities
In addition to its regulatory review responsibilities under Executive Order 12866
and its multiple responsibilities under the Paperwork Reduction Act (paperwork
review, information resources management, statistical policy and coordination,
records management, privacy and security, and information technology), Congress
has assigned OIRA a number of other specific functions related to the rulemaking
and regulatory process. For example:
! The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1532-1538)
generally requires agencies to prepare written statements describing
the effects of their rules that are subject to the act’s requirements.
The act requires the director of OMB to collect those written
statements and provide them to the Congressional Budget Office, to
establish pilot programs to test innovative regulatory approaches,
57 See [http://www.whitehouse.gov/omb/library/OMBREGSP.html], visited on May 24,
2004.
58 See [http://www.whitehouse.gov/omb/library/OMBREGSC.html], visited on May 24,
2004.
59 A list of OIRA’s meetings with outside parties can be found at
[http://www.whitehouse.gov/omb/oira/meetings.html], visited on May 24, 2004. A list of
its oral communications can be found at
[http://www.whitehouse.gov/omb/oira/oral_communications.html], visited on May 24, 2004.

CRS-25
and to prepare an annual report on the implementation of the act.
The OMB director has delegated these responsibilities to OIRA.60
! The Small Business Regulatory Enforcement Fairness Act of 1996
(SBREFA) (5 U.S.C. 601 note) required EPA and OSHA to convene
“advocacy review panels” before publishing proposed rules expected
to have a significant economic impact on a substantial number of
small entities.61 The act specifically requires the review panel to
include full-time employees from OIRA as well as other agencies.
! SBREFA also contains provisions commonly referred to as the
“Congressional Review Act,” which (among other things) requires
agencies to delay the effective date of “major” rules, and requires
GAO to submit a report on those rules within 15 days of their
issuance. SBREFA defines a major rule as one that the OIRA
administrator concludes has resulted or is likely to result in (among
other things) a $100 million annual effect on the economy.62
! Section 515 of the Treasury and General Government
Appropriations Act for Fiscal Year 2001 (44 U.S.C. 3504 (d)(1) and
3516), generally known as the “Data Quality Act” or the
“Information Quality Act,” directed OMB to take several actions (all
of which were delegated to OIRA). Specifically, the act required
OMB to issue governmentwide guidelines that “provide policy and
procedural guidance to Federal agencies for ensuring and
maximizing the quality, objectivity, utility, and integrity of
information (including statistical information) disseminated by
Federal agencies.” OMB published those guidelines in final form on
February 22, 2002.63 The act also required agencies to develop their
own guidelines (which were reviewed by OMB), and to report to
OMB on the number and nature of complaints received and how
such complaints were handled by the agency.
! Section 624 of the Treasury and General Government
Appropriations Act, 2001, (31 U.S.C. 1105 note), sometimes known
as the “Regulatory Right-to-Know Act,” requires OMB to prepare
and submit with the budget an annual “accounting statement and
associated report” containing an estimate of the costs and benefits
60 For a more complete discussion of UMRA, see CRS Report RS20058, Unfunded
Mandates Reform Act Summarized
, by Keith Bea and Richard S. Beth.
61 This requirement is codified at 5 U.S.C. 609.
62 For a more complete discussion of the Congressional Review Act, see CRS Report
RL30116, Congressional Review of Agency Rulemaking: An Assessment After Nullification
of OSHA’s Ergonomics Standard
, by Morton Rosenberg,
63 Office of Management and Budget, “Guidelines for Ensuring and Maximizing the Quality,
Objectivity, Utility, and Integrity of Information Disseminated by Federal Agencies; Notice;
Republication,” 67 Federal Register 8451, Feb. 22, 2002.

CRS-26
(including quantifiable and nonquantifiable effects) of federal rules
and paperwork, to the extent feasible, (1) in the aggregate, (2) by
agency and agency program, and (3) by major rule. The accounting
statement is also required to contain an analysis of impacts of federal
regulation on state, local, and tribal governments, small businesses,
wages, and economic growth. Similar one-year requirements were
in previous appropriations acts.
! The same legislation requires OMB to include “recommendations
for reform” in its cost-benefit reports. Rather than rely on its own
expertise, OIRA decided to solicit suggestions from the public. For
example, in March 2002, OIRA asked the public for
recommendations to eliminate or modify existing rules as well as to
expand or extend existing programs. In response, OIRA received
more than 300 suggestions, which OIRA turned over to the
appropriate agencies for prioritization. In February 2004, OIRA
asked the public for suggested reforms of rules affecting the
manufacturing sector. OIRA said it was focusing on manufacturing
because of the relatively large impact that regulations have on that
sector.64
! The Small Business Paperwork Relief Act of 2002 (Public Law 107-
198) requires OMB to annually publish, in the Federal Register and
on the Internet, a list of compliance assistance resources available to
small businesses. The act also requires OMB to convene and chair
a task force to study the feasibility of streamlining paperwork
requirements on small businesses. The task force was required to
file an initial report by the end of June 2003, and is required to file
a second report by the end of June 2004.
! The E-Government Act of 2002 (Public Law 107-347) requires the
OIRA administrator to work with the administrator of the Office of
Electronic Government to establish the strategic direction of the
governmentwide e-government program and to oversee its
implementation. OIRA has been particularly active in the
Administration’s e-rulemaking initiative.
! In the Treasury and General Government Appropriations Act, 2002
(Public Law 107-67), Congress stated that about $6.3 million of
64 A similar requirement for “recommendations for reform” was included in section
628(a)(3) of the FY2000 Treasury and General Government Appropriations Act. OIRA
received 71 suggestions from the public in response to its call for “suggestions on specific
regulations that could be rescinded or changed that would increase net benefits to the
public,” most of which came from the Mercatus Center at George Mason University. OIRA
reviewed these suggestions and identified 23 as a “high priority” for review. Eight of the
23 high priority recommendations involved EPA rules, and five involved rules from the
Department of Labor. Although business groups generally applauded this effort,
environmentalists and public interest groups characterized it as the development of a “hit
list” of rules that the Bush Administration wanted to eliminate.

CRS-27
OMB’s $70.7 million appropriation was for OIRA, but stipulated
that nearly $1.6 million of that amount should not be obligated until
OMB “submits a report to the Committees on Appropriations that
provides an assessment of the total costs and benefits of
implementing Executive Order No. 13166.”65
! The conference report for OMB’s appropriation for FY2004 (to
accompany H.R. 2673) directed OIRA to submit a report to the
House and Senate Committees on Appropriations by June 1, 2004,
on “whether agencies have been properly responsive to public
requests for correction of information pursuant to the (Data Quality
Act).”66
Congress also sometimes limits OIRA’s actions through riders on OMB’s
appropriation. For example, since 1983, language has been included in OMB’s
appropriation stating that none of the funds appropriated to OMB could be used for
the purpose of reviewing any agricultural marketing orders issued by the Department
of Agriculture. Marketing orders, which cover dozens of commodities from lemons
to milk, basically keep prices up by regulating supplies, and had been targeted for
elimination or amendment by President Reagan’s task force on regulatory relief in
the early 1980s. In response, Members of Congress have inserted this restriction in
each subsequent appropriation bill, asserting that the Department of Agriculture, not
OMB, has statutory authority in this area.
In other cases, OIRA has taken on additional responsibilities, basing its actions
on previous statutory or executive order authority. For example, in September 2003,
the administrator of OIRA published a proposed bulletin in the Federal Register on
“Peer Review and Information Quality” that would, when made final, provide a
standardized process by which all significant regulatory information would be peer
reviewed. Issued under the authority of the Data Quality Act, the PRA, and
Executive Order 12866, the bulletin would require agencies to (1) have all
“significant regulatory information” that the agencies intend to disseminate peer
reviewed, (2) have “especially significant regulatory information” peer reviewed
according to even higher standards, and (3) provide OIRA at least once each year
with information about upcoming significant regulatory disseminations and the
agencies’ plans for conducting peer reviews. In April 2004, OIRA published a
revised version of the proposed bulletin in response to comments received from the
public.67
65 Executive Order 13166, “Improving Access to Services for Persons With Limited English
Proficiency,” 65 Federal Register 50121, Aug. 16, 2000. For a copy of the report, see
[http://www.whitehouse.gov/omb/inforeg/lepfinal3-14.pdf], visited on May 24, 2004.
66 OIRA submitted this report in April 2004. For a copy of the report, see
[http://www.whitehouse.gov/omb/inforeg/fy03_info_quality_rpt.pdf], visited on May 24,
2004.
67 For a copy of this revised peer review bulletin, see
[http://www.whitehouse.gov/omb/inforeg/peer_review041404.pdf], visited on May 24,
2004.

CRS-28
OIRA and the Future of
Presidential Regulatory Review
For nearly 25 years, OIRA has played a central role in the federal rulemaking
process. Although some argued early in OIRA’s history that the office’s regulatory
review role was unconstitutional, few observers continue to hold that view. No court
has directly addressed the constitutionality of the OIRA regulatory review process,
but in 1981 (the year that OIRA was created) the D.C. Circuit said the following:
The court recognizes the basic need of the President and his White House staff
to monitor the consistency of agency regulations with Administration policy. He
and his advisors surely must be briefed fully and frequently about rules in the
making, and their contributions to policymaking considered. The executive
power under our Constitution, after all, is not shared — it rests exclusively with
the President.68
OIRA is located within the Executive Office of the President and is the
President’s direct representative in the governmentwide rulemaking process. As
Executive Order 12866 states, OIRA is the “repository of expertise on regulatory
issues” within the Executive Branch, and is uniquely positioned both within OMB
(with its budgetary influence) and within the federal rulemaking process (reviewing
and commenting on rules just before they are published in the Federal Register) to
enable it to exert maximum influence.
Variations in how OIRA operates — as a gatekeeper or a counselor — are
largely a function of the wishes of the President that the office serves. For example,
in a June 2001 article in Harvard Law Review, Elena Kagan posited that, while it is
generally acknowledged that President Reagan used OIRA’s review function as a tool
to control the policy and political agenda in an anti-regulatory manner, President
Clinton did much the same thing to accomplish pro-regulatory objectives.69 She said
he did so by exercising directive authority and asserting personal ownership over a
range of agency actions, thereby making them “presidential” in nature. She also
characterized this emergence of enhanced methods of presidential control over the
regulatory state — what she termed the “presidentialization of administration” — as
“the most important development in the last two decades in administrative process.”
Other observers, however, view OIRA (like other executive branch agencies)
as having more of a shared allegiance between the President and the Congress. They
point out that OIRA was created by Congress, and has been given a number of
statutory responsibilities through the PRA and other laws. Nevertheless, even
supporters of a strong legislative perspective recognize that OIRA is part of the
Executive Office of the President, and that Congress gave OIRA its responsibilities
68 Sierra Club v. Costle, 657 F.2d 298 (D.C. Cir. 1981).
69 Elana Kagan, “Presidential Administration,” Harvard Law Review, vol. 18 (June 2001),
pp. 2245-2385.

CRS-29
because of its strategic position within that office.70 With both statutory and
executive order responsibilities, OIRA embodies a broader tension between Congress
and the President for control of administrative agencies.
Although major differences of opinion exist among observers of the federal
rulemaking process regarding the appropriateness of OIRA’s regulatory review role,
the broad reach and influence of the office’s is undebatable. Rulemaking agencies
formally challenge OIRA’s returns and “suggestions” for change only rarely, and
sometimes refrain from even submitting draft rules for review if they believe they
will be opposed by OIRA. Regulated entities also recognize OIRA’s influence, and
seem to view the office as a “court of second resort” if they are unable to influence
regulatory agencies to their position directly.
Possible Legislative Issues
Congress also recognizes the importance that OIRA plays in the rulemaking
process, and usually holds several hearings each year examining OIRA’s
implementation of its responsibilities pursuant to various statutes and executive
orders. Proposals for changes to OIRA’s authority and responsibilities have focused
on such issues as (1) providing a statutory underpinning for regulatory reviews, (2)
increasing or decreasing the office’s funding and staffing, (3) including independent
agencies’ rules under the office’s regulatory review function, and (4) improving the
transparency of OIRA’s regulatory review processes.
Statutory Authority for Regulatory Review. As noted previously,
Congress has enacted legislation expanding OIRA’s statutory responsibilities, and
has considered (but not enacted) legislation that would provide a statutory basis for
OIRA’s regulatory review function. For example, in the 106th Congress, section 632
of S. 746 (the “Regulatory Improvement Act of 1999") would have required the
President (via OMB and OIRA) to “establish a process for the review and
coordination of Federal agency regulatory actions.” The proposed legislation also
would have placed in statute many of the transparency requirements in Executive
Order 12866.
Congress has also considered legislation that would affect OIRA as part of
broader OMB changes. For example, during the 107th Congress, proposed
legislation was introduced (H.R. 616) that would have established an Office of
Management within the Executive Office of the President and redesignated OMB as
the Office of the Federal Budget. As part of that process, OIRA and other offices
within OMB would have been abolished and their functions and authorities
transferred to the new Office of Management. Neither of these bills was enacted.
Funding and Staffing. OIRA does not have a specific line item in the
budget, so its funding is part of OMB’s appropriation. Similarly, OIRA’s staffing
70 For example, David H. Rosenbloom, in Building a Legislative-Centered Public
Administration
(Tuscaloosa, AL: The University of Alabama Press, 2001) states that “where
coordinated government-wide clearance is required to achieve Congress’ policy objectives,
there may be few or no alternatives (to paperwork and regulatory review within OMB).”

CRS-30
levels are allocated from OMB’s totals. Although OIRA staffing has increased in
recent years, as of May 2004, OIRA had fewer staff than it had when its regulatory
review function was first established in 1981. Currently, about 30 OIRA desk
officers and branch chiefs review about 3,000 agency information collection requests
each year and about 700 significant rules each year. At various times in its history,
certain Members of Congress have attempted to reduce funding for OIRA in order
to signal congressional displeasure with the office’s actions.71 Other observers,
however, believe that OIRA’s funding should be increased, not reduced, arguing that
a relatively small amount of additional resources for OIRA could yield substantial
benefits.72
At other times, proposed legislation has been introduced designating how OIRA
staff should be used. For example, in the 108th Congress, a provision in H.R. 2432
as originally introduced would have required the OMB Director to “assign, at a
minimum, the equivalent of at least 2 full time staffers to review the Federal
information collection burden on the public imposed by the Internal Revenue
Service.” The Internal Revenue Service accounts for more than 80% of the estimated
paperwork burden, but OIRA indicated that it devoted less than one FTE to
reviewing the agency’s paperwork requests (because much of the burden is mandated
by statute). The Bush Administration objected to this specific direction of OIRA
staff, so the sponsors of the bill agreed to delete this requirement before it was
approved by the House of Representatives in May 2004.
Addition of Independent Agencies’ Rules. Although several of the
statutes that OIRA helps to administer include rules issued by independent regulatory
agencies (e.g., the PRA, the Regulatory Flexibility Act, the Congressional Review
Act, and the Data Quality Act), the executive orders that have established regulatory
review within OIRA have explicitly excluded rules issued by those agencies.73 Some
observers have suggested that this limitation be lifted, arguing that independent
regulatory agencies issue regulations that have a significant impact on the economy
(about $230 billion per year according to OIRA) but their rules often contain little
quantitative information on regulatory costs and benefits.74 Those opposed to this
71 For example, as noted previously, in OMB’s appropriation for 2002, Congress stipulated
that nearly $1.6 million should not be obligated until OMB submitted a report assessing the
total costs and benefits of implementing Executive Order No. 13166. Also, in the
conference report for OMB’s FY2004 appropriation (under the heading “Office of
Information and Regulatory Affairs”), the conferees directed that $1 million “be withheld
from obligation until resolution of existing programmatic concerns by House conferees are
addressed and the House and Senate Committee on Appropriations approve of such
obligations.”
72 See, for example, Robert W. Hahn and Robert E. Litan, Why Congress Should Increase
Funding for OMB Review of Regulations
, AEI-Brookings Joint Center for Regulatory
Studies, Policy Matter 03-33, Oct. 2003.
73 For purposes of regulatory review, both Executive Order 12291 and Executive Order
12866 defined a covered “agency” as excluding those agencies specified in 44 U.S.C.
3502(10).
74 See, for example, the Center for Regulatory Effectiveness, A Blueprint for OMB Review
(continued...)

CRS-31
expansion in OIRA’s duties point out that independent regulatory agencies were
established to be relatively independent of the President, and inclusion of their rules
under OIRA’s would be counter to this purpose. In response, proponents argue that
independent regulatory agencies’ rules are already reviewed for purposes such as
paperwork clearance and ensuring that data quality requirements are met, so
examining the substance of the rules is just an extension of those reviews.
Transparency of Reviews. One consistent area of concern to some
observers has been the lack of transparency of the OIRA review process to the public.
Notwithstanding recent improvements, they argue that it is difficult for the public to
know with any degree of certainty what changes OIRA has suggested to agencies’
draft rules, what contacts OIRA has made with regulated entities and other outside
parties regarding those rules, or whether documents were exchanged between OIRA
and the agencies. In its September 2003 report, GAO said that the documentation
that agencies are required to provide showing the changes made at OIRA’s
suggestion or recommendation were not always available and, when done, were not
always clear or consistent. GAO also said that the transparency requirements
incumbent on OIRA were not always clear, and recommended several improvements.
For example:
! Although OIRA indicated that it can have its greatest impact on
agencies’ rules during informal reviews before review packages are
formally submitted, OIRA indicated that agencies only had to
disclose the changes made at OIRA’s suggestion during formal
review (some of which were as short as one day). GAO
recommended that OIRA define this requirement in the executive
order to include informal reviews, just as it did with regard to the
requirements involving the office’s communications with outside
parties.
! As noted previously, the “consistent with change” code in OIRA’s
database does not differentiate between OIRA- or agency-initiated
changes, or changes that were major or minor in nature. GAO
recommended that the database be changed to more clearly indicate
which rules were substantively changed at OIRA’s suggestion.
! GAO also recommended refinements to the executive order’s
requirements applicable to OIRA (e.g., more clearly indicating on its
website the regulatory actions being discussed at meetings with
outside parties and the affiliations of the participants) and the
requirements applicable to the agencies (e.g., defining the types of
“substantive” changes that agencies should disclose).
74 (...continued)
of Independent Agency Regulations, March 2002. The previously mentioned bill (S. 746)
that proposed to establish in law presidential review of rules would have included rules
issued by independent regulatory agencies.

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In commenting on GAO’s report, the administrator of OIRA said that the office
planned to review its implementation of the executive order’s transparency
requirements and would work to improve the clarity of its meeting log. The
administrator did not, however, believe that changes made during informal OIRA
reviews should be disclosed — even though he said that OIRA can have its greatest
influence during informal reviews. Disclosure of these informal review changes
could be required through an administrative directive issued by the OIRA
administrator or, alternatively, through legislation.

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