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Testimony: 

Before the Subcommittee on Commercial and Administrative Law, Committee 
on the Judiciary, House of Representatives: 

United States Government Accountability Office: 

GAO: 

For Release on Delivery Expected at 2 p.m. EST: 

Thursday, March 30, 2006: 

Federal Rulemaking: 

Perspectives on 10 Years of Congressional Review Act Implementation: 

Statement of J. Christopher Mihm, Managing Director, Strategic Issues: 

GAO-06-601T: 

GAO Highlights: 

Highlights of GAO-06-601T, testimony to the Subcommittee on Commercial 
and Administrative Law, Committee on the Judiciary, House of 
Representatives: 

Why GAO Did This Study: 

This year marks the 10th anniversary of the Congressional Review Act 
(CRA). Congressional oversight of rulemaking using the CRA can be an 
important and useful tool for monitoring the regulatory process and 
balancing and accommodating the concerns of American citizens and 
businesses with the effects of federal agencies’ rules. This statement 
provides an overview of the purpose and provisions of CRA; GAO’s role 
and activities in fulfilling its responsibilities under the Act; and 
trends on CRA within the broader context of developments in 
presidential and congressional oversight of federal agencies’ 
rulemaking. 

What GAO Found: 

CRA gives Congress an opportunity to review most rules before they take 
effect and to disapprove those found to be too burdensome, excessive, 
inappropriate, duplicative, or otherwise objectionable. Under CRA, two 
types of rules, major and nonmajor, must be submitted to both Houses of 
Congress and GAO before they can take effect. The Office of Information 
and Regulatory Affairs (OIRA) of the Office of Management and Budget 
specifies which rules are designated as major rules based on criteria 
set out in the CRA. Major rules cannot be effective until 60 days after 
publication in the Federal Register or submission to Congress and GAO, 
whichever is later. Congress may disapprove agencies’ rules by 
introducing a resolution of disapproval that, if adopted by both Houses 
of Congress and signed by the President, can nullify an agency’s rule. 
Members of Congress seldom have attempted to use this process. 

GAO’s role under CRA is to provide Congress with a report on each major 
rule concerning GAO’s assessment of the promulgating federal agency’s 
compliance with the procedural steps required by various acts and 
executive orders governing the regulatory process. GAO compiles 
information on the rules it receives under CRA in a database containing 
basic information about major and nonmajor rules. GAO also conducts an 
annual review to determine whether all final rules covered by the Act 
and published in the Federal Register have been filed with the Congress 
and GAO. Although we reported that agencies’ compliance with CRA 
requirements was inconsistent during the first years after CRA’s 
enactment, compliance improved over time. 

There have been a limited number of CRA joint resolutions, but the 
benefits of compiling and making information available on potential 
federal actions should not be underestimated. The procedures for 
congressional disapproval also may have some deterrent effect. Efforts 
to enhance presidential oversight of agencies’ rulemaking appear to 
have been more significant and widely employed in recent years than 
similar efforts to enhance congressional oversight. Some recent 
legislative proposals have focused on expanding the information and 
analysis available to Congress on pending rules, while others focus on 
enhancing the mechanisms that Congress could employ for its own 
review—and potential disapproval—of agencies’ rules. 

Facts on CRA since Its Enactment on March 29, 1996: 
* 37 Joint Resolutions of Disapproval introduced affecting 28 rules; 
* 1 rule nullified by Congress through Joint Resolution procedures; 
* 610 major rules received and reported on by GAO; 
* 41,218 nonmajor rules entered into GAO database; 
* About 200 nonmajor rules per year not filed with GAO; 
* All 610 major rules filed with GAO in a timely fashion; 
* 71 of 610 major rules—effective date not delayed for required 60 
days.  

www.gao.gov/cgi-bin/getrpt?GAO-06-601T. 

To view the full product, click on the link above. For more 
information, contact J. Christopher Mihm at (202) 512-6806 or 
mihmj@gao.gov. 

[End of section] 

Mr. Chairman and Members of the Subcommittee: 

I am pleased to appear before you today on the 10th anniversary of the 
enactment of the Congressional Review Act (CRA).[Footnote 1] As you 
know, CRA was enacted to ensure that Congress has an opportunity to 
review, and possibly reject, rules before they become effective. Under 
CRA, two types of rules, major and nonmajor, must be submitted to both 
Houses of Congress and GAO before they can take effect. We are required 
to provide Congress with a report on each major rule concerning our 
assessment of the promulgating federal agency's compliance with the 
procedural steps required by various acts and executive orders 
governing the regulatory process. 

Over the past 10 years, agencies have submitted information on 
thousands of rules as required by the CRA. Although we generally found 
that agencies complied with CRA's requirements, one main area of 
noncompliance has been that agencies have not always delayed the 
effective date of their major rules for 60 days, as required by the 
Act. While considerable information on agencies' rules has been 
reported under CRA, to date Congress has used the Act to disapprove 
only one rule, the Department of Labor's rule on ergonomics in 2001. In 
contrast, our reviews indicated that efforts to increase presidential 
influence and authority over the regulatory process have become more 
significant and widely used over the years. 

In my statement today, I will focus on three topics. First, I will 
provide a quick overview of the purpose and provisions of CRA. Second, 
I will discuss GAO's role in fulfilling its responsibilities under the 
Act and summarize our CRA activities over the years. Finally, I will 
address CRA within the broader context of developments in presidential 
and congressional oversight of federal agencies' rulemaking. My 
statement is based on our activities and observations implementing our 
responsibilities under CRA over the past decade and our related body of 
work reviewing federal regulatory issues. 

Overview of CRA Purpose, Procedures, and Requirements: 

Congressional oversight of rulemaking using the CRA can be an important 
and useful tool for monitoring the regulatory process and balancing and 
accommodating the concerns of American citizens and businesses with the 
effects of federal agencies' rules. As we noted early in the 
implementation of CRA, it is important to assure that executive branch 
agencies are responsive to citizens and businesses about the reach, 
cost, and impact of regulations, without compromising the statutory 
mission given to those agencies.[Footnote 2] CRA seeks to accomplish 
this by giving Congress an opportunity to review most rules before they 
take effect and to disapprove those found to be too burdensome, 
excessive, inappropriate, duplicative, or otherwise objectionable. 

With certain exceptions, CRA applies to most rules issued by federal 
agencies, including the independent regulatory agencies.[Footnote 3] 
Under CRA, two types of rules, major and nonmajor, must be submitted to 
both Houses of Congress and GAO before they can take effect. CRA 
defines a "major" rule as one which results or is likely to result in 
(1) an annual effect on the economy of $100 million or more; (2) a 
major increase in costs or prices for consumers, individual industries, 
government agencies, or geographic regions; or (3) significant adverse 
effects on competition, employment, investment, productivity, 
innovation, or on the ability of U.S.-based enterprises to compete with 
foreign-based enterprises in domestic and export markets. CRA specifies 
that the determination of what rules are major is to be made by the 
Office of Information and Regulatory Affairs (OIRA) of the Office of 
Management and Budget (OMB). Major rules cannot be effective until 60 
days after publication in the Federal Register or submission to 
Congress and GAO, whichever is later. Nonmajor rules become effective 
when specified by the agency, but not before they are filed with 
Congress and GAO. 

CRA established a procedure by which members of Congress may disapprove 
agencies' rules by introducing a resolution of disapproval that, if 
adopted by both Houses of Congress and signed by the President, can 
nullify an agency's rule. If such a resolution becomes law, the rule 
then cannot take effect or continue in effect. In addition, CRA 
prohibits an agency from reissuing such a rule in substantially the 
same form, or a new rule that is substantially the same as the 
disapproved rule, unless the reissued or new rule is specifically 
authorized by a law enacted after the date of the joint resolution 
disapproving the original rule. Members of Congress seldom have 
attempted to use this disapproval process. Over the past decade, 37 
joint resolutions of disapproval have been introduced regarding 28 
rules. Only once has Congress used this disapproval process to nullify 
a rule, when it disapproved the Department of Labor's rule on 
ergonomics in 2001.[Footnote 4] 

GAO's Role and Activities under CRA: 

GAO's only stated role under CRA is to provide Congress with a report 
on each major rule concerning GAO's assessment of the promulgating 
federal agency's "compliance with the procedural steps" required by 
various acts and executive orders governing the regulatory process. 
These include preparation of a cost-benefit analysis, when required, 
and compliance with the Regulatory Flexibility Act, the Unfunded 
Mandates Reform Act of 1995 (UMRA), the Administrative Procedure Act 
(APA), the Paperwork Reduction Act, and Executive Order 12866. GAO's 
report must be sent to the congressional committees of jurisdiction 
within 15 calendar days of the publication of the rule or submission of 
the rule by the agency, whichever is later. While the CRA is silent 
with regard to GAO's role concerning nonmajor rules, we found that 
basic information about those rules also should be collected in a 
manner that can be of use to Congress and the public. 

To compile information on all the rules submitted to us under CRA, we 
established a database, available to the public on the 
Internet.[Footnote 5] Our database gathers basic information about the 
15-20 major and nonmajor rules that we receive each day, including the 
title, the agency, the Regulation Identification Number, the type of 
rule, the proposed effective date, the date published in the Federal 
Register, the congressional review trigger date, and any joint 
resolutions of disapproval that may have been introduced. We created a 
standardized submission form available on the Internet, which is used 
by almost all the agencies, to allow more consistent information 
collection. Since CRA was enacted on March 29, 1996, we have received 
and submitted timely reports on 610 major rules and entered 41,218 
nonmajor rules into the database.[Footnote 6] 

As noted earlier, before a rule can become effective, it must be filed 
in accordance with CRA. We conduct an annual review to determine 
whether all final rules covered by the Act and published in the Federal 
Register have been filed with the Congress and us. We perform the 
review to both verify the accuracy of our database and to ascertain the 
degree of agency compliance with CRA. We forward a list of unfiled 
rules to OIRA for their handling, and, in the past, they have 
disseminated the list to the agencies, most of which file the rules or 
offer an explanation of why they do not believe a rule is covered by 
CRA. 

Although we reported that agencies' compliance with CRA requirements 
was inconsistent during the first years after CRA's enactment, 
compliance improved over time. In general, we have found the degree of 
compliance to have remained fairly constant, with roughly 200 nonmajor 
rules per year not filed with our office. In the 10 years since CRA was 
enacted, all major rules have been filed in a timely fashion. 

In the past 10 years, we also have issued eight opinions regarding what 
constitutes a "rule" under CRA in response to requests from 
congressional committees and members concerning various agency 
pronouncements and memorandums. CRA contains a broad definition of the 
term "rule," including more than the usual notice and comment 
rulemakings published in the Federal Register under APA. Under CRA, 
"rule" means the whole or part of an agency statement of general 
applicability and future effect designed to implement, interpret, or 
prescribe law or policy. For example, in 1996 we concluded that a 
memorandum issued by the Secretary of Agriculture in connection with 
the Emergency Salvage Timber Sale Program constituted a rule under CRA 
and should have been submitted to Congress and GAO before it could 
become effective.[Footnote 7] Similarly, in 2001, we concluded that a 
Fish and Wildlife Service Record of Decision entitled "Trinity River 
Mainstem Fishery Restoration" was a rule covered by CRA.[Footnote 8] We 
believe these opinions have strengthened the reach of CRA by insuring 
compliance with the main thrust of the Act, which was to insure that 
agency actions, whether labeled a "rule" by the agency or not, are 
subject to congressional review. We have noted that certain 
congressional committees, such as the Joint Committee on Taxation, were 
taking an active role in overseeing agency compliance with CRA. As a 
result, for example, Internal Revenue Service procedures, rulings, 
regulations, notices, and announcements are forwarded as CRA 
submittals. 

The one major area of noncompliance with the requirements of the Act 
has been that agencies have not always delayed the effective date of 
major rules for 60 days as required by the Act.[Footnote 9] Agencies 
have filed 610 major rules with our office, and, for 71 of those rules, 
the agencies did not delay the effective date for the required 60 days. 

One reason for noncompliance with the 60-day delay is that the agencies 
have misapplied the "good cause" exception which waives the delay of 
the rule if it would be impracticable, unnecessary, or contrary to the 
public interest.[Footnote 10] Since the enactment of CRA, our office 
has consistently held that the "good cause" exception is only available 
if a notice of proposed rulemaking was not published and public 
comments were not received.[Footnote 11] Many agencies, following a 
notice of proposed rulemaking and receipt of comments, have stated in 
the preamble to the final major rule that "good cause" existed for not 
providing the 60-day delay. 

The other reason for noncompliance is that the statute that an agency 
is implementing by issuing the final major rule contains a date by 
which the Secretary or Administrator must issue the regulation, and the 
date, in many instances, does not permit the 60-day delay. However, the 
CRA states that it shall apply notwithstanding any other provision of 
law.[Footnote 12] 

Trends in Presidential and Congressional Review of Rulemaking: 

Agencies and GAO have provided Congress a considerable amount of 
information about forthcoming rules in response to CRA. The limited 
number of CRA joint resolutions introduced might suggest that this 
information generates little additional oversight of rulemaking. 
However, as we found in our review of the information generated on 
federal mandates under UMRA, the benefits of compiling and making 
information available on potential federal actions should not be 
underestimated.[Footnote 13] Further, as we also found regarding UMRA, 
the availability of procedures for congressional disapproval may have 
some deterrent effect. The Congressional Research Service has reported 
that several rules have been affected by the presence of the review 
mechanism, suggesting that the CRA review scheme has had some 
influence. 

Still, as I noted in my testimony before this Subcommittee last 
November, efforts to enhance presidential oversight of agencies' 
rulemaking appear to have been more significant and widely employed in 
recent years than similar efforts to enhance congressional 
oversight.[Footnote 14] In particular, our reviews have noted the 
growing influence and authority of OIRA in the oversight of the 
regulatory process.[Footnote 15] Some of this increased activity 
reflects administration initiatives, but it also includes some new 
responsibilities assigned by Congress through statute, such as the 
requirement for OMB to issue governmentwide guidance to implement the 
Information Quality Act.[Footnote 16] 

In contrast, there does not appear to have been a similar expansion of 
direct congressional influence and authority over the regulatory 
process, although bills have been introduced over the years to enhance 
the mechanisms available for congressional oversight of agencies' 
rulemaking. Some recent legislative proposals have focused on expanding 
the information and analysis available to Congress on pending rules, 
while others focus on enhancing the mechanisms that Congress could 
employ for its own review--and potential disapproval--of agencies' 
rules. 

As the major example of the first category of proposals, Congress 
passed the Truth in Regulating Act (TIRA) in 2000 to provide a 
mechanism for it to obtain more information about certain 
rules.[Footnote 17] In contrast to the essentially procedural reviews 
that GAO now conducts under CRA, TIRA contemplated a 3-year pilot 
project during which GAO would perform independent evaluations of 
"economically significant" agency rules when requested by a chairman or 
ranking member of a committee of jurisdiction of either House of 
Congress. However, during the 3-year period contemplated for the pilot 
project, Congress did not enact any specific appropriation to cover 
TIRA evaluations, as called for in the Act, and the authority for the 3-
year pilot project expired on January 15, 2004. Therefore, we have no 
information on the potential effectiveness of this mechanism. 

Congress has considered reauthorizing TIRA, and we have strongly urged 
that any reauthorization of TIRA continue to contain language requiring 
a specific annual appropriation for GAO before we are required to 
undertake independent evaluations of major rulemakings. Such an 
expansion of GAO's current lines of business without additional 
dedicated resources would pose a serious problem for us, especially in 
light of what will likely be increasing budgetary constraints in the 
years ahead. It would also likely serve to adversely affect our ability 
to provide the same level of service to the Congress in connection with 
our existing statutory authorities. We have also recommended that TIRA 
evaluations be conducted under a pilot project basis. 

Members of Congress have also introduced several bills over the past 
year that would provide additional mechanisms for direct review and 
approval (or disapproval) of agencies' rules.[Footnote 18] Some of 
these proposals would modify how Congress reviews information submitted 
under CRA and how the disapproval procedures would work. These bills 
could, for example, create a joint committee that would be tasked with 
reviewing all rules to determine whether a disapproval resolution under 
CRA should be introduced. We have conducted no work that would provide 
information on the potential effectiveness of such changes. 

Mr. Chairman, this concludes my prepared statement. Once again, I 
appreciate the opportunity to testify on these important issues. I 
would be pleased to address any questions you or other Members of the 
Subcommittee might have at this time. 

If additional information is needed regarding this testimony, please 
contact J. Christopher Mihm, Managing Director, Strategic Issues, at 
(202) 512-6806 or mihmj@gao.gov. 

FOOTNOTES 

[1] 5 U.S.C. §§ 801-808. CRA was enacted as Subtitle E of the Small 
Business Regulatory Enforcement Fairness Act of 1996 (SBREFA), Pub. L. 
No. 104-121, on March 29, 1996. 

[2] GAO, Congressional Review Act, GAO/T-OGC-97-29 (Washington, D.C.: 
Mar. 6, 1997). 

[3] In addition to some general exceptions, such as one regarding any 
rule relating to agency management or personnel, CRA does not apply to 
any rule promulgated under the Telecommunications Act of 1996 and the 
amendments made by that Act. Nor does CRA apply to rules that concern 
monetary policy proposed or implemented by the Board of Governors of 
the Federal Reserve System or the Federal Open Market Committee. 

[4] Pub. L. No. 107-5, 115 Stat. 7 (Mar. 20, 2001). 

[5] GAO's Federal Rules Database is publicly available at www.gao.gov 
under the "Legal Products" link. The reports we prepare on major rules 
under CRA are also available on that site. 

[6] Number of major and nonmajor rules are as of March 24, 2006. 

[7] See B-274505, Sept. 16, 1996. 

[8] See B-287557, May 14, 2001. 

[9] 5 U.S.C. § 801(a)(3)(A). 

[10] 5 U.S.C. § 808(2). 

[11] See B-275549; B-275552, Dec. 9, 1996. 

[12] 5 U.S.C. § 806(a). 

[13] See GAO, Unfunded Mandates: Analysis of Reform Act Coverage, GAO-
04-637 (Washington, D.C.: May 12, 2004) and Unfunded Mandates: Views 
Vary About Reform Act's Strengths, Weaknesses, and Options for 
Improvement, GAO-05-454 (Washington, D.C.: Mar. 31, 2005). 

[14] See GAO, Federal Rulemaking: Past Reviews and Emerging Trends 
Suggest Issues That Merit Congressional Attention, GAO-06-228T 
(Washington, D.C.: Nov. 1, 2005). 

[15] See GAO, Rulemaking: OMB's Role in Reviews of Agencies' Draft 
Rules and the Transparency of Those Reviews, GAO-03-929 (Washington, 
D.C.: Sept. 22, 2003). 

[16] The Information Quality Act is also known as the Data Quality Act. 
Consolidated Appropriations Act, 2001, Pub. L. No. 106-554, 114 Stat. 
2763, 2763A-153-54 (Dec. 21, 2000). 

[17] Pub. L. No. 106-312, 114 Stat. 1248 (Oct. 17, 2000), 5 U.S.C. § 
801 note. 

[18] See, for example, H.R. 576, H.R. 931, and H.R. 3148.