Good Guidance Practices and Other Regulatory Management Reforms
In a groundbreaking initiative to improve the regulatory process, the Bush Administration has established government-wide good guidance practices, as well as other reforms to better justify and manage regulations. These reforms were established by a Presidential Executive Order and an accompanying Bulletin on Good Guidance Practices by the Office of Management and Budget (OMB).
Why These Reforms are Important to You
For the first time, the Federal Government has established government-wide “rules of the road” to manage the development and use of guidance documents. Good guidance practices (GGP) are policies and procedures for federal agencies to follow when developing, issuing and using guidance documents. The goal is to ensure that agency guidance documents are: developed with appropriate review by senior officials and public participation; accessible and transparent to the public; of high quality; and not improperly treated as binding requirements.
This is a big step forward, because guidance documents have become a core component of regulatory programs. As the scope and complexity of regulatory programs has grown, agencies increasingly have relied on guidance documents to provide direction to their staff and to the public. At the same time, concerns have been raised by many authorities that agency guidance practices should be better managed and be more transparent, consistent, and accountable. The GGP and other reforms establish oversight and accountability for agency guidance documents and strengthen current oversight of agency regulations.
Background on the Good Guidance Practices and Other Reforms
President Bush's Executive Order amends and strengthens President Clinton's Executive Order 12866 on Regulatory Planning and Review. President Bush gave clear direction to OMB to review significant agency guidance documents, just as OMB reviews significant agency regulations. The agencies, in turn, are required to give OMB advance notice of their upcoming significant guidance documents. >
The Bush Executive Order also requires agencies to clearly explain the need for regulations. Before issuing a new regulation, an agency must assess in writing the specific market failure or other problem it intends to address and the significance of that problem. Moreover, each agency must designate a political appointee to serve as its Regulatory Policy Officer (“RPO”). No rulemaking may commence or be included in an agency's regulatory plan unless approved by the RPO. Finally, each agency must provide an estimate of the combined costs and benefits of all of its regulations planned for the calendar year.
The OMB Bulletin on Good Guidance Practices supplements President Bush's Executive Order. The Bulletin establishes basic requirements for “significant” guidance documents.1 First, agencies must implement written procedures for the approval of significant guidance documents by appropriate senior officials. Agency employees should not depart from significant guidance documents without appropriate justification and supervisory concurrence. Second, significant guidance documents must have standard elements, such as information identifying the document as guidance, the issuing office, the activity and persons to whom it applies, the date of issuance, title and docket number. Agencies also are directed to avoid inappropriate mandatory language.
The Bulletin also establishes public access and feedback procedures. For example, agencies are required to maintain on their Web sites a current list of their significant guidance documents, including links to each public guidance document and an identification of which guidance documents have been added, revised or withdrawn in the previous year. Each agency also must advertise on its Web site a means for the public to electronically submit comments on significant guidance documents, or to request that they be created, reconsidered or modified. The Bulletin does not require agencies to provide a response to comments.
Finally, the Bulletin establishes more exacting notice and comment requirements for significant guidance documents that rise to the level of being “economically” significant.2 Unless otherwise exempted, when an agency prepares an economically significant guidance document, it is required to provide advance public notice and an opportunity to comment on a draft, and a response to the public comments.
Read the amendment to Executive Order 12866.
To read the Final Bulletin for Agency Good Guidance Practices.
1Similar to the definition of significant regulations in E.O. 12866, the Bush Executive Order generally defines the term “significant guidance document” as a guidance document that may reasonably be anticipated to: (i) 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; (ii) create a serious inconsistency or otherwise interfere with an action taken or planned by another agency (iii) materially alter the budgetary impact of entitlements, grants, user fees, or loan programs or the rights or obligations of recipients thereof; or (iv) raise novel legal or policy issues arising out of legal mandates, the President's priorities, or the principles set forth in this Executive order.
2Under the OMB Bulletin, an “economically significant” guidance document is a significant guidance document that may reasonably be anticipated to lead to an annual effect on the economy of $100 million or more or adversely affect in a material way the economy or a sector of the economy, except that economically significant guidance documents do not include guidance documents on Federal expenditures and receipts.
For more information, please contact the professional(s) listed below, or your regular Crowell & Moring contact.