Courts that have considered similar issues have held that it is not necessary to create a public record of verbal input from OMB and have not disapproved of concurrent review. Your concern is that concurrent review may violate the requirements of section 307 (d)(4)(B)(ii) of the Clean Air Act. Whether a particular draft is sufficiently complete to be given external circulation is an agency decision which is not governed by section 307. Provided that a copy of the Red Border draft is placed in the docket. We understand that the concurrent review may make it more difficult to trace the origin of revisions made as a result of interagency review before the rule is published. We do not think this practice is prohibited by section 307.
B-221421, Oct 21, 1987, 67 Comp.Gen. 19
MISCELLANEOUS TOPICS - Environment/Energy/Natural Resources - Environmental Protection - Air Quality - Standards - Review Procedures DIGEST: EPA may send draft rules to OMB for review under Executive Order 12291 at the same time it begins final internal review of proposed rules. Clean Air Act provisions that require creating a formal record and docketing drafts circulated for interagency review do not prohibit concurrent EPA/OMB review. Neither the applicable statute nor its legislative history dictates that only final products be circulated, or that all input to the rules, including verbal input from OMB, be identifiable from the public record, although any EPA actions to modify draft rules based on verbal input must also be fully supported by the public record. Courts that have considered similar issues have held that it is not necessary to create a public record of verbal input from OMB and have not disapproved of concurrent review.
The Honorable John D. Dingell:
Your letter of July 13, 1987 asked for our views on the Environmental Protection Agency's (EPA) practice of conducting concurrent review of proposed regulations both within EPA (the so called "Red Border" review) and at the Office of Management and Budget (OMB) in fulfillment of Executive Order 12291. Your concern is that concurrent review may violate the requirements of section 307 (d)(4)(B)(ii) of the Clean Air Act, 42 U.S.C. Sec. 7607 (d)(4)(B)(ii). Section 307 requires that any draft submitted for interagency review be placed in the public docket. As we see it, whether a particular draft is sufficiently complete to be given external circulation is an agency decision which is not governed by section 307. Accordingly, we conclude that the section does not prohibit concurrent review, provided that a copy of the Red Border draft is placed in the docket. We understand that the concurrent review may make it more difficult to trace the origin of revisions made as a result of interagency review before the rule is published, but we do not think this practice is prohibited by section 307.
Section 307 and Its Legislative History
The pertinent paragraph of section 307 discusses the written materials which must promptly be placed in the public docket for certain proposed or final rules. It provides in subparagraph (d)(4)(B)(ii) as follows:
"The drafts of proposed rules submitted by the Administrator to the Office of Management and Budget for any interagency review process prior to proposal for any such rule, all documents accompanying such drafts, and all written comments thereon by other agencies and all written responses to such written comments by the Administrator shall be placed in the docket no later than the date of the proposal of the rule. The drafts of the final rule submitted for such review process prior to promulgation and all such written comments thereon, all documents accompanying such drafts, and written responses thereto shall be placed in the docket no later than the date of promulgation."
The plain language of the statute calls for inclusion in the docket of the "drafts ... submitted ... to the Office of Management and Budget for any interagency review. ..." The statute does not specify the particular stage of internal review at which it is appropriate to circulate a draft to OMB. As such, it does not prohibit concurrent review.
Moreover, the legislative history of section 307 does not provide a basis for assuming that a broader intent underlies the law. Congress added section 307 when it overhauled the Clean Air Act in 1977. The original Clean Air Act provided for EPA to conduct its administrative business using informal rulemaking procedures. By 1977, Congress had become aware that, absent standardized recordkeeping requirements, informal rulemaking resulted in written records being compiled principally for defense purposes only. Such ad hoc compilations were often inconsistent, and at times were either overbroad or incomplete or both.
In the legislative history, the House explained its intention to adopt the suggestions put forth in a law review article by William Pedersen, Jr., entitled "Formal Records and Informal Rulemaking," (85 Yale L.J. 38 (1975)). The article advocated the contemporaneous assembly of a "procedural record," consisting of standard documentation that would fully justify agency action as well as simplify discovery and expedite judicial review. H.R. Rep. No. 450, 95th Cong., 1st Sess. 319 (1977).
We understand the concern that under the authority of Executive Order 12291, OMB may be exercising undue influence over major policy decisions and substantive or technical issues related to specific rules. We also know that, in practice, most of OMB's comments are oral and as a result, the docket may not show which of many revisions in published rules are actually attributable to OMB review. /1/
We realize that it would perhaps be easier to deduce which changes were OMB-inspired if the draft sent to OMB were the final EPA product, rather than the Red Border draft. However, the legislative history of section 307 does not evidence an intent to enable any interested person to dissect a published rule so as to reconstruct the origin of each and every change made to the final draft.
Since the principal purpose behind section 307 is facilitation of judicial review, we think it is also important that the Court of Appeals for the D.C. Circuit held in Sierra Club v. Costle, that section 307 does not require reducing OMB's verbal input to writing and entering it in the docket. In that case, the court held:
"The purposes of full record review which underlie the need for disclosing ex parte conversations in some settings do not require that the courts know the details of every White House contact, including a Presidential one, in this informal rulemaking setting."
657 F.2d 298, 407 (D.C. Cir. 1981). This is consistent with our view that section 307 was not intended to ensure that the exact source of each change in a final rule could be identified.
EPA's Use of Concurrent Review
In the course of our work, we found that EPA has used concurrent review of selected regulations since 1981, when Executive Order 12291 was first implemented. 46 Fed.Reg. 13193. EPA typically uses concurrent review for rules that are not expected to undergo major changes during the Red Border process. Alternatively, the process may be used if necessary to meet either a court-imposed or a statutory deadline. If concurrent review were to proceed on the optimum schedule, its use would save approximately 30 days. The Assistant Administrator of the Office of Policy Planning and Evaluation decides whether to send a regulation to OMB for concurrent review, based on whatever early comments are received in that Office concerning the Red Border package.
Our study of regulations issued under the Clean Air Act indicates that concurrent review has been used often in the last several years to process a variety of regulations. In addition, the process has been used to review regulations issued under other laws the EPA is responsible for administering.
The only court that has thus far considered the practice of concurrent EPA Red Border/OMB review expressed doubt whether the process would in fact expedite issuance of a long-delayed regulation, but it did not disapprove concurrent review in principle. Environmental Defense Fund v. Thomas, 627 F.Supp. 566, 571 (D.D.C. 1986). Although the regulation in question there was a waste disposal rule, not a Clean Air Act rule, we think the court's holding can fairly be applied to other rulemaking settings where concurrent review is used. See also, Public Citizen Health Research Group v. Tyson, 796 F.2d 1479, 1507 (D.C. Cir. 1986).
We hope the foregoing is of assistance to you. In accordance with our usual procedures, this opinion will be released 30 days from its date.
/1/ See, e.g., Staff of Senate Comm. on Environment and Pub. Works, Office of Management and Budget Influence on Agency Regulations, S. Prt. 99-156, 99th Cong., 2d Sess., passim. (1986); Olson, the Quiet Shift of Power, Office of Management & Budget Supervision of Environmental Protection Agency Rulemaking Under Executive Order 12291, 4 Va. J. Nat. Res. L. 1 (1986). See also, Morrison, OMB Interference with Agency Rulemaking: The Wrong Way to Write a Regulation, 99 Harv. L. Rev. 1059 (1986).