New Executive Order to Modernize Regulatory Review

By Trent Cotney, Adams and Reese, LLP

An Overview of the Regulatory System

Anyone can tell you that regulatory review policies can be complicated and confusing. In an attempt to address that, on April 6, President Joe Biden signed the Executive Order on Modernizing Regulatory Review. This EO focuses on modernizing those policies and making the overall process more inclusive and equitable.

On his first day as president, Biden issued a memorandum about the regulatory review process, and this EO follows up on the goals outlined that day. 

What the EO Stipulates

The EO recognizes that to fully develop regulatory plans and agendas, government agencies must work to engage citizens and groups who are affected by the policies. It includes more considerations and accommodations for local, state, tribal and territorial agencies, as well as the underserved. It reads: “Opportunities for public participation shall be designed to promote equitable and meaningful participation by a range of interested or affected parties, including underserved communities.”

The Role of the OIRA

The Office of Information and Regulatory Affairs (OIRA) is responsible for reviewing regulatory actions from the executive branch, and it has served Democratic and Republican presidents for decades. When the process is handled effectively, it can promote policies that improve the lives of people across the nation. 

IORA Administrator Richard Revesz explained the need for change in a White House blog titled, “Strengthening Our Regulatory System for the 21st Century.” He wrote, “To meet the challenges and opportunities ahead of us, our country needs an efficient, modern regulatory system that delivers for the American people. Effective regulation can provide critical benefits to the public such as clean air and water, reliable transportation, consumer protection, employment protections and a stronger economy.”

The EO notes that the public should be more involved in the process and instructs the OIRA as follows: 

“The Administrator of OIRA, in consultation with relevant agencies, as appropriate, shall consider guidance or tools to modernize the notice-and-comment process, including through technological changes. These reforms may include guidance or tools to address mass comments, computer-generated comments (such as those generated through artificial intelligence), and falsely attributed comments.”

It also encourages the OIRA to make “efforts to ensure access for meeting requesters who have not historically requested such meetings.”

In addition, the EO updates the criteria for triggering a rigorous regulatory review. The threshold for rigorous regulatory review had been $100 million in annual economic effects. The EO increases that to $200 million and calls for the threshold to be adjusted every three years based on GDP. 

Revesz explained, “This change will help return the number of regulations subject to more rigorous review to levels consistent with earlier administrations.”

Updating Regulatory Analysis Guidance

Beyond the details of the EO, the White House Office of Management and Budget (OMB) has proposed changes to Circular A-4. This regulatory analysis guidance has not been updated since 2003. 

The changes are intended “to help agencies better account for the value of future regulatory effects and provide the greatest benefits for the American people.”

Revisions include providing more support in understanding future costs, risks and distributional effects. 

The OMB is also suggesting changes to Circular A-94, which offers guidance on how to spend federal grant money and has not been updated since 1992. The proposed changes will “help better target federal funds for crucial projects by updating for decades of scientific and economic advances and knowledge.” 

Impact of the EO and OMB Updates 

The combination of the EO and the OMB-proposed updates may very well streamline and improve the regulatory process. Will the changes be effective? That remains to be seen, but Revesz has high hopes. 

He summarized, “At the end of the day, the changes we’re announcing and proposing today are focused on ensuring our regulatory system works for the American people. This isn’t about more or fewer regulations — it’s about getting regulations right. 

Next to lack of skilled labor, government regulation is a roofing contractor’s top concern. In theory, modernizing regulatory review will help ensure that agencies have the information they need to make the right decisions.

The information contained in this article is for general educational information only. This information does not constitute legal advice, is not intended to constitute legal advice, nor should it be relied upon as legal advice for your specific factual pattern or situation. 

Trent Cotney is a partner and Construction Practice Group Leader at the law firm of Adams and Reese LLP and RCAW General Counsel. For more information, you can contact Trent at trent.cotney@arlaw.com or (866) 303-5868.

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