Page 1 Reexamining Regulations: Opportunities to Improve Effectiveness and Transparency of Reviews...

Reexamining Regulations: Opportunities to Improve Effectiveness

and Transparency of Reviews

Administrative Conference of the United StatesMarch 2011 Workshop

For more information, contact Tim Bober (202) 512-4432

Defining the term “retrospective regulatory review” for report GAO-07-791

• No one standard term or definition (e.g., look-backs, ex post studies, retrospective studies, validation studies)

• For purposes of the GAO report, defined as an assessment of an existing regulation primarily for the purposes of determining whether

• Expected outcomes of the regulation have been achieved,

• Agency should retain, amend, or rescind the regulation, and/or

• Actual benefits and costs of the implemented regulation correspond with estimates at time issued

Objectives

• GAO’s objectives were to identify:

• Numbers and types of retrospective regulatory reviews that agencies completed from 2001 through 2006

• Outcomes, including perceived usefulness, of the reviews

• Processes and standards that guided agencies in selecting, conducting, and reporting on reviews

• Factors that helped or hindered conducting or using retrospective reviews

Highlights

• From 2001 through 2006, selected agencies completed over 1,300 reviews of existing regulations, but the impetus for and purpose of the reviews varied

• The outcomes of reviews varied (including changes to regulations and guidance and confirmation that existing rules achieved intended results), with reviews initiated on agencies’ discretion being considered more useful than mandatory reviews

• The processes and standards guiding reviews varied by the extent to which agencies applied a standards-based approach, incorporated public participation, and documented the reviews

• Multiple factors helped or impeded the conduct and usefulness of retrospective reviews

Scope

• GAO reviewed activities from calendar years 2001 through 2006 for nine selected agencies covering health, safety, environmental, financial, and economic regulations

• Departments of Agriculture, Justice, Labor, and Transportation; Consumer Product Safety Commission; Environmental Protection Agency; Federal Communications Commission; Federal Deposit Insurance Corporation; and Small Business Administration

• The selected agencies accounted for almost 60 percent of all final rules published during 2001-2006

Methodology

• Reviewed available documents (e.g., relevant statutes, agencies’ records, policies, and procedures)

• Administered a structured data collection instrument on review activities and lessons learned

• Solicited perspectives of oversight entities (OMB and Office of Advocacy) and knowledgeable nonfederal parties from academia, business, public advocacy, and state government

• Assessed agencies’ general processes using three criteria:• Use of a standards-based approach• Incorporation of public involvement• Documentation of review processes and results

• Completed more detailed assessment of a limited sample of reviews for agencies’ application of standards and practices

Agencies completed many reviews, but the impetus and purpose varied• Agencies identified at least 1300 reviews completed between 2001—

2006• Contradicts common perception that agencies do very little

• Agencies said that most reviews are done on their own discretion, rather than in response to mandatory requirements• But most of the 1300+ they documented were mandatory reviews

• Agencies said that the main purpose of most reviews was to examine the effectiveness of the implementation of their regulations• Other purposes included reducing regulatory burdens and validating

original estimates of benefits and costs

Outcomes varied; discretionary reviews considered more useful• Outcomes of reviews included

• Amendments to regulations• Changes to guidance and related documents• Decisions to conduct additional studies• Confirmation that existing rules were working as intended

• Mandated reviews most often resulted in a determination that no changes were needed

• Agencies characterized discretionary reviews as more productive and likely to generate action• Better at addressing emerging issues

• Reviews that addressed multiple purposes perceived as more useful

Processes and standards used by agencies varied

• GAO assessed and compared processes across multiple dimensions

• Review phase: selection, conduct, reporting

• Application of general practices for effective and transparent reviews: standards-based approach, public involvement, documentation

• Type of review: mandatory or discretionary

• Agency

Use of standards-based approaches

Incorporation of public involvement

Documentation of review processes and results

Process example: Employee Benefits Security Administration

Process example: Federal Communications Commission

Barriers to conducting reviews

• Critical barriers cited by agency officials and nonfederal parties included:

• Difficulty in devoting the time and resources needed to carry out review requirements

• Competes with other mission-related activities

• Limitations on ability to obtain the information and data needed for reviews

• Baseline data• Post-implementation data

Barriers to the usefulness of reviews

• Agencies cited predetermined review schedules and/or duplicative review factors as a primary barrier

• Mandatory requirements may have overlapping schedules and/or duplicative review criteria

• Requirements may duplicate factors already considered in agency-initiated reviews (e.g., prompted by petitions, industry feedback, accidents, or changes to technology and market conditions)

Examples of overlapping timing and review factors

Barriers to usefulness of reviews (continued)

• Other barriers included:

• Constraints in an agency’s ability to modify some regulations without legislative action

• Scoping reviews too broadly

• Lack of public participation (cited by both agencies and nonfederal parties)

• Lack of transparency in agency review processes, results, and follow-up (cited by nonfederal parties)

Lessons learned and practices for improving reviews• Agencies and nonfederal parties suggested:

• Pre-planning for the data collection and review methodology needed to conduct future reviews

• Developing a prioritization process for selection of regulations to be reviewed

• Obtaining high-level management support for implementing and following up on reviews

• Considering use of independent parties to conduct reviews (suggested by the nonfederal parties)

Lessons learned (continued)

• Grouping related regulations together to improve public participation and quality of input

• Tailoring reporting (e.g., level of information and type of product) to the needs of various audiences (cited by nonfederal parties)

• Recognizing the value of reviews in helping to save costs associated with implementing outdated regulations or repeatedly responding to similar petitions

Conclusions

• Agencies are doing more, and a greater variety, of reviews than is readily apparent to the public

• Effective reporting is lacking• There is no “one size fits all” approach, but agencies could benefit from

sharing lessons• Substantive, multipurpose reviews are more credible and useful than

pro-forma reviews• Fiscal constraints will require more careful consideration of uses of

existing resources• Review of regulations is only one tool for understanding the

performance of regulatory agencies• The performance of the programs that implement regulations and

the statutes that underlie the regulations must also be considered for a full picture

Recommendations

• OIRA and the Office of Advocacy should develop guidance to agencies to incorporate the following elements, where appropriate, into their policies and procedures governing regulatory review activities:

3. Consideration, during promulgation of new rules, of whether and how they will measure performance of the regulation

4. Prioritization of review activities based on defined selection criteria

Recommendations (continued)

3. Identifying specific review factors to be applied to the conduct of agencies’ analyses

4. Minimum standards for documenting and reporting all completed review results

5. Mechanisms to assess means of communicating review results to the public and identify steps to improve this communication

6. Steps to promote sustained management attention to and support of review initiatives

Recommendations (continued)

• We further recommended that OIRA and the Office of Advocacy work with agencies to identify opportunities for Congress to revise the timing and scope of existing regulatory review requirements and/or consolidate existing requirements

• We also suggested that Congress may wish to consider authorizing a pilot program with selected agencies that would allow the agencies to satisfy various review requirements with similar factors that apply to the same regulations by conducting one review reported to all appropriate parties and oversight bodies

Status of recommendations

• In 2007 and 2008, the Office of Advocacy published best practices guidance to agencies regarding reviews conducted under Section 610 of the Regulatory Flexibility Act and took additional actions to promote retrospective reviews of regulations

• The OIRA Administrator’s February 2011 memorandum on implementing Executive Order 13563 provides guidance that appears to address many of the factors identified in GAO’s 2007 recommendations

• The recommendations regarding opportunities for Congress to revise the timing and scope of existing review requirements or consolidate existing requirements have not been acted upon

GAO on the WebWeb site: http://www.gao.gov/

ContactChuck Young, Managing Director, Public Affairs, [email protected](202) 512-4800, U.S. Government Accountability Office441 G Street NW, Room 7149, Washington, D.C. 20548

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