What Can We Learn From the Unified Regulatory Agenda?

The U.S. Chamber of Commerce has warned of an impending “regulatory tsunami” that “poses … the single biggest challenge to jobs, our global competitiveness, and the future of American enterprise.” But how many new regulations do federal agencies actually have in the works?

House Speaker John Boehner (R-OH) and officials within the Obama Administration have sparred back and forth about this question, with some members of the administration claiming the Speaker has exaggerated the size and economic impact of the federal regulatory pipeline.

The government’s semiannual Unified Agenda of Regulatory and Deregulatory Actions speaks directly to this debate. For more than twenty years, the Agenda has listed twice each year “all regulations under development or review” by agencies across the federal government.

The most recent Agenda, from June of this year, lists a total of 4,257 regulatory actions at different stages of development:  667 were recently completed; 1,276 were nearing the final rule stage; 1,509 were at the proposed rule stage; and 79 were at the pre-rule stage.  726 were listed as long-term actions.

Regulations appearing in the Agenda are further classified according to whether they are “economically significant” under Executive Order 12866 or “major” under the Congressional Review Act (CRA). To qualify as “major” under the CRA and “economically significant” under Executive Order 12,866, a rule basically needs an expected impact – positive or negative – to the economy of $100 million.

The following table shows how the rules in the last Agenda break down according to these classifications.

The Unified Agenda identifies 219 of the total 4,257 regulatory actions as “economically significant” and 210 as “major.” Given the similarity of the definitions, many actions (182) are identified as both major and economically significant. However, 37 are designated as economically significant but not major, and 28 are listed as major but not economically significant. Additionally, agencies have not yet determined whether 556 regulations listed in the Unified Agenda fit the definition of major.

Of the 247 regulatory actions the Agenda lists as major, economically significant, or both, 40 are completed, leaving 207 upcoming regulatory actions at various stages of development that agencies expect will have impacts of $100 million or more per year. Of these, the Unified Agenda identifies 158 actions with an impact above the $100 million threshold that agencies are at the stage of proposing or finalizing.

It should be noted that the figures reported in the Agenda probably understate to some degree the number of regulatory actions underway for two reasons.

First, the Unified Agenda does not include many regulatory actions that are completed on an expedited basis. For example, interim final rules (such as those issued in response to deadlines in the recent Affordable Care Act) may sometimes take effect without the agency first obtaining public comment and often these rules are completed before they can be listed in the Agenda. Over 25 percent of the interim final rules OIRA reviewed in the first nine months of 2011 were not previously listed in the Unified Agenda.

Second, although independent regulatory commissions (IRCs) include their regulatory activities in the Unified Agenda, their designations of economic impact are not validated by any outside entity. By contrast, for executive branch agencies – those headed by single appointees who serve at the pleasure of the president – the Office of Information and Regulatory Affairs (OIRA) has the authority and the institutional capacity to evaluate (and, if appropriate, override) agencies’ own designations. OIRA has more limited authority over and information regarding IRC regulations.

Perhaps not surprisingly, IRCs appear to designate fewer regulations as major or economically significant than executive branch agencies. For example, the Commodity Futures Trading Commission (CFTC) includes 68 regulatory actions in its listing in the Agenda, many of which are being developed pursuant to the Dodd-Frank financial reform law; however, the CFTC does not classify any as economically significant or major. It classifies one half as non-major and the other half as “undetermined.”

Similarly, of the 105 regulatory actions the Securities and Exchange Commission (SEC) lists in the Agenda, the agency designates only five as major and none as economically significant.

If these and other IRCs eventually classify as “major” the 44 proposed and final rules they have labeled “significant” but as of yet “undetermined” under the CRA, that would increase the total number of proposed or final major actions that rise above the $100 million threshold from 158 to 202.

Despite its limitations, the Unified Agenda provides a useful searchable database and resource for those interested in understanding the regulatory activities going on across the U.S. government. The Agenda’s pages provide a reasonable answer to the timely question of the volume of consequential rules currently in the regulatory development pipeline.