H.R. 3438, Require Evaluation before Implementing Executive Wishlists (REVIEW) Act of 2016

H.R. 3438

Require Evaluation before Implementing Executive Wishlists (REVIEW) Act of 2016

Sponsor
Rep. Tom Marino

Committee
Judiciary

Date
September 21, 2016 (114th Congress, 2nd Session)

Staff Contact
John Huston

Floor Situation

On­­­­ Wednesday, September 21, 2016, the House will begin consideration of H.R. 3438, the Require Evaluation before Implementing Executive Wishlists (REVIEW) Act of 2016, under a structured rule. H.R. 3438 was introduced on August 4, 2015, by Rep. Tom Marino (R-PA) and was referred to the Committee on the Judiciary, which ordered the bill reported, as amended, by a vote of 18 to 13 on September 8, 2016.

Bill Summary

H.R. 3438 amends the Administrative Procedure Act to require federal agencies to postpone the implementation of any rule imposing an annual cost on the economy of more than $1 billion (classified as a “high-impact” rule) if a petition seeking judicial review of that regulation is filed within the statutorily provided time for challenging the rule’s issuance (or a default period of 60 days). Under the bill, implementation would be postponed until any judicial review is resolved.

Background

Congress often grants rulemaking authority to federal agencies to implement statutory programs. The regulations issued pursuant to this authority carry the force and effect of law and can have substantial implications for policy implementation. When issuing these regulations, agencies are required to follow a certain set of procedures prescribed in law and executive orders. These procedures collectively comprise the federal rulemaking process.[1]

The Administrative Procedure Act (APA) provides for a strong presumption of judicial review regarding agency rules. Judicial recourse is available for any party aggrieved by a final agency action unless a statute precludes judicial review, or if a decision is left to agency discretion by law. Under the APA, a court may compel any agency action that is unreasonably delayed or unlawfully withheld. Furthermore, a court may vacate an agency rule if the agency acted (1) arbitrarily or capriciously; (2) in excess of statutory authority; (3) contrary to a constitutional right; or (4) without following proper procedures.[2]

However, there are many rules that impose significant cost to the economy and state and local governments as soon as they are implemented, before judicial review can take place. In Michigan v. EPA, the Court ruled against the U.S. Environmental Protection Agency, holding that its Utility MACT rule, which newly regulated air emissions from power plants, was legally infirm because the agency deemed costs irrelevant to its decision to promulgate the rule. Those costs totaled an estimated $9.6 billion per year, to achieve benefits in airborne mercury emissions of only $4–6 million per year.[3]

The Court, however, failed to set aside the rule, requiring the continuing incurrence of compliance costs pending remand to the court of appeals. Billions of additional dollars, moreover, had already been incurred by the power-generating industry under the unlawful rule, because the rule was not stayed by the courts pending the multi-year, ultimately successful legal challenge to the rule.[4]

The Office of Management and Budget (OMB) indicates that in recent years there have been about five regulations issued each year that would have an estimated annual impact on the economy of $1 billion or more. H.R. 3438 would require federal agencies to postpone implementation of these rules until the judicial review process is complete.

According to the bill sponsor, “Every day, American workers, taxpayers and families bear the burden of the regulatory hubris emanating from Washington.  As executive agencies grow bolder, so too does the scope and effect of their actions. Too often, the financial burden of these reckless regulations falls on the backs of hard-working Americans. The compliance costs alone are felt nationwide and touch every corner of our economy. The REVIEW Act is an important step in curtailing far-reaching regulations and ensures Washington rule makers are held accountable. The federal government cannot continue to pad its pocketbooks by stealing from the American people.”[5]

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[1] See CRS Report, “Federal Regulations and the Rulemaking Process,” November 26, 2014.
[2] Id.
[3] See House Report 114-743
[4] Id.
[5] See Rep. Tom Marino, “Reps. Marino, Goodlatte Applaud Committee Passage of Bill to Stop “High Impact” Regulations,” September 8, 2016.

 

Cost

The Congressional Budget Office (CBO) cannot determine whether enacting H.R. 3438 would increase net direct spending or on-budget deficits by more than $5 billion in any of the four consecutive 10-year periods beginning in 2027.

Amendments

  1. David Cicilline (D-RI) – This amendment exempts any rule that would reduce the cost of healthcare for people over the age of 65 from the requirements of the bill.
  2. Suzan DelBene (D-WA) – This amendment exempts any rules relating to improving the affordability of higher education from the requirements of the bill.

Additional Information

For questions or further information please contact John Huston with the House Republican Policy Committee by email or at 6-5539.