On March 1,2017, by a vote of 241 to 104, the House passed the “OIRA Insight, Reform, and Accountability Act” (H.R. 1009), which would subject independent regulatory agencies such as the CFPB to the regulatory review process of the Office of Information and Regulatory Affairs (OIRA) within the Office of Management and Budget. The bill has been referred to the Senate Committee on Homeland Security and Governmental Affairs.
Currently, under Executive Order 12866, federal agencies, other than those defined as an “independent regulatory agency” by 44 U.S.C. Sec. 3502(5), must submit proposed and final regulations constituting a “significant regulatory action” to OIRA for review prior to publication in the Federal Register. A key component of OIRA review is an evaluation of the agency’s analysis of a regulation’s anticipated costs and benefits and its determination that the regulation’s anticipated benefits justify its anticipated costs as well as the agency’s identification and assessment of feasible alternatives. The Executive Order defines a “significant regulatory action” as any regulatory action that is likely to result in a rule that may (a) “have an annual effect on the economy of more than $100 million or more,” (b) “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, tribal governments or communities,” or (c) raise other coordination, budgetary, or policy issues, such as creating a serious inconsistency with another agency’s action.
Executive Order 12866 also contains requirements that apply to both executive and independent agencies, such as the preparation of a semi-annual rulemaking agenda and an annual regulatory plan to be published in the Unified Regulatory Agenda and participation in a regulatory working group convened by OIRA. In addition to generally codifying these and other requirements of the Executive Order, H.R. 1009 codifies the Order’s definition of “significant regulatory action” and its requirement for OIRA review of new regulations that constitute a “significant regulatory action” but makes the review requirement applicable to both executive and independent agencies.
According to the report on the bill issued by the House Committee on Oversight and Government Reform, the exclusion of independent regulatory agencies from OIRA review in Executive Order 12866 “means that numerous controversial and extremely costly regulations are issued without the second look by regulatory experts that OIRA review provides.” In addition to the CFPB, the other independent regulatory agencies currently excluded from OIRA review by Executive Order 12866 include the Federal Reserve, the FCC, the FDIC, the FTC, and the OCC.