Thoughts on Current Events in Congress and the Administration: the CRA and an E.O.

Congressional Review Act  The Wall Street Journal’s Kimberly Strassel wrote last week about far-reaching implications of the Congressional Review Act, noting that Congress can overrule some regulations and guidance promulgated since 2009, depending on whether the agency promulgating the rules filed a report with Congress.

The accepted wisdom in Washington is that the CRA can be used only against new regulations, those finalized in the past 60 legislative days. That gets Republicans back to June, teeing up 180 rules or so for override.


But what Mr. Gaziano told Republicans on Wednesday was that the CRA grants them far greater powers, including the extraordinary ability to overrule regulations even back to the start of the Obama administration. The CRA also would allow the GOP to dismantle these regulations quickly, and to ensure those rules can’t come back, even under a future Democratic president. No kidding.

Here’s how it works: It turns out that the first line of the CRA requires any federal agency promulgating a rule to submit a “report” on it to the House and Senate. The 60-day clock starts either when the rule is published or when Congress receives the report—whichever comes later.

According to Todd Gaziano, former counsel to a Congressional sponsor of the law, not all agencies file the required reports, so that the clock doesn’t start running for Congress to use the CRA. In other words, if an agency issued a major rule in 2014, but did not send Congress its report on the rule, and the new administration submitted a report today, Congress would have 60 days to use the CRA process.

One point to consider is that Congress has always had the power to undo a regulation it didn’t like. What the CRA does is require the Executive Branch to disclose its regulations to the Congress and provide for a far quicker consideration process, thus making the whole exercise more simple and more likely to happen.

Another interesting point is that the effective date of the rule itself may depend on whether a report gets filed. 5 U.S.C. 801(a)(3) states that a major rule shall take effect 60 days after the latest date on which Congress receives the report or the rule is published in the Federal Register.  If Congress did not receive a report, is the rule not effective?

One of the most interesting questions that the CRA presents is whether the law provides for Congress to invalidate part of a “rule.” A rule means many things in the lingo of an agency. People will say that they are working on a “rule,” and the rule will contain paragraph after paragraph, page after page, of requirements. Despite the vernacular, each of those requirements is a rule.  14 C.F.R. § 417.107 is one section in the FAA regulations governing launch safety, but it alone contains many requirements, many rules. Often an agency determines what a “rule”– in the bureaucratese sense–will contain based on what is ready to change. For example, the FAA’s original spaceport requirements at 14 C.F.R. part 420 addressed a plethora of different topics, including flight safety analysis, explosive siting, coordination with Air Traffic Services, and procedural requirements. The explosive siting requirements in turned addressed the storage and handling of, and safe separation distances for, solid propellants, fuels, and oxidizers. It seems plausible that Congress could invalidate parts of a rulemaking, since so many of them deal with so many different topics. After all, Congress may do so even without the CRA, albeit more slowly.

Executive Order:  One Rule Passed, Two Rules Repealed On January 30, 2017, President Trump released an Executive Order directing agency heads to identify for elimination two regulations for every new one issued:

any new incremental costs associated with new regulations shall, to the extent permitted by law, be offset by the elimination of existing costs associated with at least two prior regulations. Any agency eliminating existing costs associated with prior regulations under this subsection shall do so in accordance with the Administrative Procedure Act and other applicable law.

As in the usual way of things, existing regulations must be repealed through the standard rulemaking process, where a proposed repeal is shared with the public for notice and comment. The E.O.’s real bite comes from its requirement that agency heads keep the total costs of new and repealed regulations to zero, unless otherwise required by law or consistent with written advice from the Office of Management and Budget. In order to achieve a total annual cost of zero, agencies must offset new regulatory costs by the elimination of existing regulatory costs. Each agency will be assigned costs caps, and OMB will provide guidance on how to implement the new order. The WSJ reports that this is not uncommon:

Canada requires every rule that creates another hour of paperwork for business compliance to be offset one for one. The United Kingdom and Australia have harder versions that require the costs of new rules to be offset by deregulation of comparable net value.

What counts as an offsetting cost? It will be interesting to see if OMB allows agencies to offset requirements without regard to the identity of the affected industry. The Federal Aviation Administration, for example, regulates both aviation and space transportation. Could the FAA achieve its annual regulatory budget by increasing costs on one mode of transportation and offsetting those new costs with savings applied to another mode of transportation? Likewise, could the Federal Communications Commission offset costs imposed on satellite services with savings on terrestrial providers?

The Order states that the “regulations” and “rules” to which it applies do not include “regulations issued with respect to a military, national security, or foreign affairs function of the United States.” Although the FAA issues its launch and reentry licenses and permits consistent with the national security interests of the United States, this Order will likely apply to the FAA’s space regulations unless it can be successfully argued that the FAA’s Office of Commercial Space Transportation has a national security function of its own. That seems unlikely.

Practioner’s Note: If one were to be trying to find out whether an agency submitted its required report on a particular rule, the Senate appears to have an accessible list here. Not being a millennial, I have not yet found the House version. If anyone has that, please let me know in comments or through my contact information and I will amend this post. Also, I found the Senate version through pure serendipity, by plugging in the name of a published FAA rule, and the link doesn’t appear to be devoted solely to reports.