Last week was, for the most part, relatively quiet on the regulatory side. If anything, it was full of…housekeeping. The two landmark regulations focused on exciting topics such as the internal agency retrospective review process and financial reporting for multi-employer pension funds. Across all regulations, the agencies posted $396.4 million in total net savings, but added 1.4 million annual hours of paperwork.
- Proposed Rules: 40
- Final Rules: 66
- Total pages 2022: 32,241
- 2022 final rule costs: $11.3 billion
- Proposed rule costs for 2022: $75 billion
NOTABLE REGULATORY ACTIONS
The most important regulation of the week was the official meeting of the Department of Health and Human Services (HHS) Withdrawal of the SUNSET (Securing Updated and Necessary Statutory Evaluations Timely) rule. This action closes the book on Trump-era policy that would have installed a more rigorous retrospective review process in HHS. The fuller implications of this withdrawal are the subject of this week’s regulatory table, below. In terms of purely quantifiable economic impact, the current Biden-era HHS estimates that removing the Trump-era rule from the books would result in total savings to the public of between $201 million and $603 million — with an estimate median of about $402. million.
The other notable element of the week was a multi-agency to reign (of the Internal Revenue Service, the Employee Benefits Security Administration and the Pension Benefit Guaranty Corporation; or “the agencies”) updating certain aspects of Form 5500, “Annual Return/Report of Employee Benefit Plan”. This reporting requirement “serves as the primary source of information and data…regarding the operations, funding and investments” of pension funds under each of the agencies’ respective jurisdictions. Although the quantified cost change is relatively small, agencies predict that such adjustments could impose approximately 1 million hours of additional paperwork each year.
FOLLOW-UP OF ADMINISTRATIONS
As we have already seen in executive orders and memos, the Biden administration will surely provide many regulatory contrasts with the Trump administration. And while the current administration is widely expected to seek to largely restore Obama-style regulatory measures, there will also be areas where it charts its own course. Since AAF RegRodeo data dates back to 2005, it is possible to provide weekly updates on how high-level trends in President Biden’s regulatory record track those of his two most recent predecessors. The following table provides the cumulative totals of the final rules containing a quantified economic impact from each administration up to this point in their respective terms.
The two rules highlighted above were the respective sources of the Biden administration’s cost and paperwork changes, with costs dropping by nearly $400 million and annual paperwork increasing by nearly a million hours. . In the previous two administrations, however, there was not much new activity to report. Nominally, the the biggest change came from Obama-era paperwork, which increased by about 55,000 hours. A ministry of education to reign provided the majority of this transport.
REGULATORY TABLE FOR THIS WEEK
This week, the sun sets on SUNSET.
On May 27, HHS released a final rule in the federal register, officially retiring a Trump administration end-of-term rule that would have required HHS to ensure its regulations had the intended effect.
The Trump rule set expiration dates for departmental regulations – with some exceptions – unless it periodically assesses those regulations to determine if they were subject to the Regulatory Flexibility Act (RFA). Under the RFA, agencies are required to assess all existing rules that significantly affect small businesses every 10 years.
The Trump HHS found that the department and its agencies often failed to assess the rules under the RFA. He determined that setting expiration dates for unrevised rules would be a good way to ensure agencies comply with the law.
Critics of the rule and the Biden administration disagreed. In its takedown notice, the Biden HHS said the Trump administration’s rule was based on a flawed factual basis. He also argued that the rule would divert resources from work on new rules to make revisions to existing rules. This last point is particularly moot since HHS is already supposed to comply with the RFA – so in this regard, the department and its agencies should already be using resources to conduct reviews.
The SUNSET rule was a novel approach in that it was the first instance of a federal department or agency putting expirations on nearly all of its regulations. The idea came from a bill from previous Congresses that would overrule all agency regulations to ensure the rules have the intended consequences.
Alas, the sun has now set on SUNSET.
Since January 1, the federal government has published $86.3 billion in total net costs (including $11.3 billion in new costs due to finalized rules) and 49.9 million hours of net annual increase in paperwork burden (including 3.9 million hours increase over final rules).