Presidential Executive Order 13422 (George W. Bush, 2007)

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Executive Order 13422: Further Amendment to Executive Order 12866 on Regulatory Planning and Review is a presidential executive order issued by President George W. Bush (R) in 2007 that aimed to strengthen presidential oversight of the regulatory review procedures established in 1993 by President Bill Clinton (D) under E.O. 12866. The Congressional Research Service stated that E.O. 13422 contained "the most significant changes to the presidential regulatory review process since 1993."[1][2]


Bush's order made several alterations to E.O. 12866, including new requirements for agencies to identify specific market failures associated with proposed regulations, to provide monetary values for the total estimated impacts of annual regulatory plans, and to obtain approval from the Office of Information and Regulatory Affairs (OIRA) for guidance documents with associated significant economic impacts, among other provisions. President Barack Obama (D) revoked E.O. 13422 in 2009.[1][3]

Background

See also: Regulatory review

President George W. Bush (R) issued Executive Order 13422, titled "Further Amendment to Executive Order 12866 on Regulatory Planning and Review," on January 18, 2007. Though the Bush administration did not provide a rationale for issuing the order, its provisions effectively functioned to strengthen the president's authority over the regulatory review of agency rules. The Competitive Enterprise Institute, a self-described free-market think tank, characterized Bush's E.O. 13422 as "a modest effort to restore some of E.O. 12291’s rigor." E.O. 12291, which instituted President Ronald Reagan's (R) regulatory review process in 1981, had been revoked by President Bill Clinton (D) in 1993 and replaced with a new regulatory review regime under E.O. 12866.[1][2][4]

E.O. 13422 implemented the following changes to the regulatory review process established under E.O. 12866:

  • The order required an agency to explicitly state the market failure addressed by a proposed regulation. Previously, agencies were required to identify the circumstances that contributed to the regulation, including possible market failures, but were not required to state a specific market failure that warranted agency action.[2][5][6]
  • Each agency was required to provide a monetary value for the total estimated impact of its annual regulatory plan. The total value was an aggregate of the individual cost-benefit analyses provided for each regulation within the plan. Under E.O. 12866, each agency had been required to perform a cost-benefit analysis for individual regulations within its regulatory plan, but had not been required to provide an aggregate cost-benefit estimate for the agency's overall regulatory agenda.[5][6]
  • The order required that the role of the regulatory policy officer (RPO) in each agency must be filled by a presidential appointee. RPOs gained the authority to approve an agency's agenda of regulatory actions—strengthening presidential influence over agency regulations. Rules specifically authorized by the agency head were exempted from RPO authorization. Prior to E.O. 13422, RPOs were only required to "'be involved' in the regulatory process, to 'foster the development' of sound rules, and to 'further' the order's principles," according to the Congressional Research Service (CRS).[2][5][6]
  • The Office of Information and Regulatory Affairs (OIRA) was required to review any agency guidance documents with an associated significant economic impact. The requirement for OIRA to review significant agency guidance documents mirrored its existing responsibility to review economically significant regulations.[5]
  • E.O. 13422 required agencies to consider, in consultation with OIRA, the use of formal rulemaking procedures "for the resolution of complex determinations." Prior to E.O. 13422, agencies had the authority to enter into formal rulemaking proceedings if the agency had determined that formal rulemaking was the best course of action. However, formal rulemaking generally fell out of favor during the 1970s and the Administrative Conference of the United States (ACUS) recommended the use of informal rulemaking when possible, according to the CRS. Therefore, the requirement that agencies consider the use of formal rulemaking did not institute any substantive changes to existing rulemaking procedures. However, the CRS speculated at the time that "an agency's 'consultation with OIRA' may result in greater use of formal rulemaking if OIRA can convince the agency that it is in their best interest to do so."[2][6]

Since the Bush administration did not provide a reason for issuing E.O. 13422, scholars have questioned the motivation behind the order, according to the CRS. Opponents of the measure observed that the order was issued shortly after Republicans lost control of the U.S. House of Representatives and the U.S. Senate in the November 2006 elections—indicating that the order was possibly intended to strengthen presidential oversight of agency regulations in the face of new Democratic policy priorities in Congress. President Barack Obama (D) revoked E.O. 13422 in 2009.[2][7]

Provisions

Identification of market failures

E.O. 13422 required agencies to explicitly state the market failures addressed by proposed regulations. Agencies were previously required to identify the circumstances that contributed to regulatory action, including possible market failures, but had not been required to identify a specific market failure that warranted agency action. E.O. 13422 amended E.O. 12866 to read as follows:[5][6][2]

“ (1) Each agency shall identify in writing the specific market failure (such as externalities, market power, lack of information) or other specific problem that it intends to address (including, where applicable, the failures of public institutions) that warrant new agency action, as well as assess the significance of that problem, to enable assessment of whether any new regulation is warranted.[1][8] ”

Estimated impacts of regulatory plans

The order amended E.O. 12866 to require agencies to include a total cost-benefit analysis for their annual regulatory plans. The aggregate value was determined by combining the cost-benefit analyses of each individual regulation within the plan as required under E.O. 12866.[5][6]

“ (c) Section 4(c)(1)(B) is amended by inserting 'of each rule as well as the agency's best estimate of the combined aggregate costs and benefits of all its regulations planned for that calendar year to assist with the identification of priorities' after 'of the anticipated costs and benefits'.[1][8] ”

Appointment of regulatory policy officers

See also: Regulatory policy officer

Each agency was required to fill the role of regulatory policy officer (RPO) with a presidential appointee, rather than an agency employee, under E.O. 13422. The order stated, "Within 60 days of the date of this Executive order, each agency head shall designate one of the agency's Presidential Appointees to be its Regulatory Policy Officer, advise OMB of such designation, and annually update OMB on the status of this designation." The order was silent on the question of whether the appointee was subject to confirmation by the U.S. Senate. RPOs also gained the authority to approve all regulatory actions by the agency included in the agency's annual regulatory plan, except for actions otherwise authorized by the head of the agency.[1][2]

Review of significant guidance documents

See also: Guidance document and economically significant rule

E.O. 13422 defined significant guidance documents as agency guidance documents with an associated significant economic impact. The order required that the Office of Information and Regulatory Affairs (OIRA) review significant guidance documents, similar to OIRA's review of economically significant regulations.[5][6]

The order established the following definition of a significant guidance document:

“

(h) 'Significant guidance document' --

(1) Means a guidance document disseminated to regulated entities or the general public that, for purposes of this order, may reasonably be anticipated to:
(A) Lead to an annual effect 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;
(B) Create a serious inconsistency or otherwise interfere with an action taken or planned by another agency;
(C) Materially alter the budgetary impact of entitlements, grants, user fees, or loan programs or the rights or obligations of recipients thereof; or
(D) Raise novel legal or policy issues arising out of legal mandates, the President's priorities, or the principles set forth in this Executive order; and
(2) Does not include:
(A) Guidance documents on regulations issued in accordance with the formal rulemaking provisions of 5 U.S.C. 556, 557;
(B) Guidance documents that pertain to a military or foreign affairs function of the United States, other than procurement regulations and regulations involving the import or export of non-defense articles and services;
(C) Guidance documents on regulations that are limited to agency organization, management, or personnel matters; or
(D) Any other category of guidance documents exempted by the Administrator of OIRA.[1][8]
 ”

Consideration of formal rulemaking

See also: Formal rulemaking

Prior to E.O. 13422, agencies had the authority to enter into formal rulemaking proceedings if the agency had determined that formal rulemaking was the best course of action. E.O. 13422 required agencies to consider following formal rulemaking procedures, in consultation with OIRA, "for the resolution of complex determinations."[6]

Presidential administrations

Barack Obama

President Barack Obama (D) revoked E.O. 13422 in 2009 by issuing Executive Order 13497, titled "Revocation Of Certain Executive Orders Concerning Regulatory Planning And Review." Obama's executive order did not state a reason for revoking E.O. 13422, but opponents of Bush's order had expressed concern that the regulatory review system under E.O. 13422 slowed down the regulatory process and prevented agencies from enacting what they considered to be important health and safety regulations.[3][9][10]

See also

External links

Footnotes

  1. ↑ 1.0 1.1 1.2 1.3 1.4 1.5 1.6 The American Presidency Project, "Executive Order 13422—Further Amendment to Executive Order 12866 on Regulatory Planning and Review," January 18, 2007
  2. ↑ 2.0 2.1 2.2 2.3 2.4 2.5 2.6 2.7 Congressional Research Service, "The Law: Executive Order 13422: An Expansion of Presidential Influence in the Rulemaking Process," September 2007
  3. ↑ 3.0 3.1 Center for Progressive Reform, "EO 13422: Erecting Obstacles to Protecting Health, Safety and the Environment," accessed March 14, 2018
  4. ↑ Competitive Enterprise Institute, "Channeling Reagan by Executive Order," July 14, 2016
  5. ↑ 5.0 5.1 5.2 5.3 5.4 5.5 5.6 Center for Effective Government, "Executive Order 13422 (amending E.O. 12866)," accessed March 13, 2018
  6. ↑ 6.0 6.1 6.2 6.3 6.4 6.5 6.6 6.7 Yale Journal on Regulation, "The Economic Significance of Executive Order 13,422," 2008
  7. ↑ George Washington Law Review, "Impact of Executive Order 13422," August 2008
  8. ↑ 8.0 8.1 8.2 Note: This text is quoted verbatim from the original source. Any inconsistencies are attributable to the original source.
  9. ↑ Center for Effective Government, "OMB Watch Applauds Obama's Revocation of Bush-Era Executive Order on Regulatory Review," February 4, 2009
  10. ↑ Center for Progressive Reform, "EXECUTIVE ORDER—REVOCATION OF CERTAIN EXECUTIVE ORDERS CONCERNING REGULATORY PLANNING AND REVIEW," January 30, 2009
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