Regulations and the Rulemaking Process

A Brief Overview of Federal Rulemaking

What Is Federal Rulemaking? Congress often grants rulemaking authority to federal agencies to implement statutory programs. The regulations issued pursuant to this
authority carry the force and effect of law. “A valid legislative rule is binding upon all persons, and on the courts, to the same extent as a congressional statute. When Congress delegates
rulemaking authority to an agency, and the agency adopts legislative rules, the agency stands in the place of Congress and makes law.” National Latino Media Coalition v. Federal Communications Commission, 816 F.2d 785, 788 (D.C. Cir. 1987).
When issuing regulations, agencies are required to follow a certain set of procedures prescribed in law and executive order. These procedures collectively comprise the federal
rulemaking process. By creating the federal rulemaking process, Congress instituted a number of procedural controls on agencies, such as ensuring that the public would have an
opportunity for participation through the public comment process required by the Administrative Procedure Act (APA).
The Rulemaking Process: Congress has enacted procedural statutes, such as the APA, setting forth procedures an agency must follow to establish a final, legally binding rule. Unless an agency’s authorizing statute provides for different procedures, the APA provides the default practice that all agencies must follow to promulgate rules. These procedures apply whenever an agency creates, amends, or repeals a rule.
Notice: Section 553 of the APA requires that an agency generally must first provide notice that it intends to promulgate a rule. An agency does this by publishing a notice of proposed
rulemaking in the Federal Register. The notice must provide:
–the time, place, and nature of the rulemaking proceedings;
–a reference to the legal authority under which the rule is proposed; and
–either the terms or subject of the proposed rule.
Comment: The agency must then allow “interested persons an opportunity” to comment on the proposed rule. Typically, an agency will provide at least 30 days for public comment.
The agency is required to review the public comments and respond to “significant” comments received, and it may make changes to the proposal based on those comments.
Publication: Once this process is complete, the agency may publish the final rule in the Federal Register along with a “concise general statement” of the rule’s “basis and purpose.” The
rule may not go into effect until at least 30 days after it is published in the Federal Register, with certain exceptions.
An agency need not follow notice and comment procedures when promulgating certain rules such as interpretive rules, general statements of policy, and rules affecting only agency management or personnel. Also, if it is “impracticable, unnecessary, or contrary to the public interest,” an agency may forgo these procedures.
Office of Information and Regulatory Affairs (OIRA):
- In 1981, President Reagan issued Executive Order (E.O.) 12291, which established centralized review of most agencies’ rules through the Office of Management and Budget’s (OMB) Office of Information and Regulatory Affairs (OIRA).
- In 1993, President Clinton issued E.O. 12866, which replaced President Reagan’s order but left much of the centralized review process intact. Under President Clinton’s order, which still remains in effect, agencies (other than independent regulatory agencies) submit their “significant” proposed and final rules to OIRA for review prior to publication. In addition, covered agencies must determine whether a rule is “economically significant” and, if it is, conduct a cost-benefit analysis of the rule, ensuring that the benefits justify the costs of the rule. OIRA is then to review the content of the rule and the quality of the cost-benefit analysis to ensure that the rule is consistent with the President’s policy preferences.
- President Trump added to these underlying requirements when he issued E.O. 13771 in January 2017. E.O. 13771 created a “one-in, two-out” requirement whereby agencies have to offset the costs of new rules by eliminating equivalent costs associated with at least two previously issued rules.
Congressional Oversight – Statutory Control over Agency Action: Congress maintains ultimate control over federal agencies’ actions–
- Congress can pass statutes that expand or contract agency authority, repeal existing rules, or compel an agency to issue certain rules;
- Congress can change the procedures agencies must follow in order to promulgate a valid regulation;
- If Congress does not want an agency to undertake a certain rulemaking proceeding, it may prohibit the agency from using appropriated funds to develop or finalize the rule.
- Congress can use the Congressional Review Act (CRA), enacted in 1996, to overturn new rules through enactment of a filibuster-proof joint resolution of disapproval;
  - Congress has 60 session days to act on a disapproval resolution and the resolution requires presidential signature.
  - Under the CRA, before a rule can take effect, an agency must submit a report to each house of Congress and the Comptroller General at the Government Accountability Office (GAO). The report must contain a copy of the rule; a statement on whether it is a major rule; and the proposed effective date of the rule.
  - If a joint resolution of disapproval is enacted, the CRA provides that a rule may not be issued in “substantially the same form” as the disapproved rule unless it is specifically authorized by a subsequent law. The CRA does not define what would constitute a rule that is “substantially the same.” In addition, the CRA prohibits judicial review of any “determination, finding, action, or omission under this chapter.”
Judicial Review of Agency Action: The APA provides for a strong presumption of judicial review of agency action. The statute provides judicial recourse for a person aggrieved by
final agency action unless a statute precludes judicial review or if a decision is left to agency discretion by law. A court may vacate an agency rule if the agency acted (1) arbitrarily or capriciously, (2) in excess of statutory authority, (3) contrary to a constitutional right, or (4) in violation of procedures required by statute.

Overview of Federal Rulemaking Process
	Congress Passes Statute requiring issuance of Rule or authorizing issuance of Rule
	Agency Develops Draft Proposed Rule
	Review/Approval of Draft Proposed Rules within Agency/Dept
	OIRA Reviews Draft Proposed Rule
	Publication of Notice of Proposed Rulemaking in Federal Register
	Public Comments
	Response to Comments and Development of Draft Final Rule
	Review/Approval of Draft Final Rule within Agency/Dept
	OIRA Review of Draft Final Rule
	Publication of Final Rule
Legal Challenge to Rule	Rule Takes Effect	Congressional Review
Court Determines Legality of Rule		Congress Votes on Disapproval Resolution

Administrative Procedure and Rulemaking Resources

Link: FederalRegister.gov
- Each day Federal agencies publish documents in the Federal Register, including proposed rules, final rules, public notices, and Presidential actions.
- Subscribe to Notifications on Specific Topics
Link: Code of Federal Regulations (CFR) is the codification of the general and permanent rules and regulations (sometimes called administrative law) published in the Federal Register by the executive departments and agencies of the federal government of the United States.
Link: Regulations.Gov
- Proposed Rules
- Final Rules
- Notices
- Public Submissions (e.g., comments, citizen petitions, early submissions)
- Supporting Materials often associated with regulatory actions

Link: OIRA Office of Information and Regulatory Affairs (White House Office of Management and Budget)
- The Paperwork Reduction Act of 1980 created the Office of Information and Regulatory Affairs (OIRA) within the Office of Management and Budget (OMB). As an office within OMB, it is part of the Executive Office of the President; its mission is to ensure that agencies’ rules reflect the President’s policies and priorities.
- GAO: Federal Rulemaking – Opportunities Remain for OMB to Improve the Transparency of Rulemaking Processes (2016)
- GAO: Federal Rulemaking – Regulatory Review Processes Could be Enhanced (2014)
- CRS: Federal Rulemaking – The Role of the Office of Information and Regulatory Affairs (2009)
- CRS: Changes to the OMB Regulatory Review Process by Executive Order 13422 (2007)
- GAO: OMB’s Role in Reviews of Agencies’ Draft Rules and the Transparency of Those Reviews (2003)
- OIRA in the Obama Administration (Archived)

Additional Background

Executive Orders

“Executive orders and proclamations are directives or actions by the President. When they are founded on the authority of the President derived from the Constitution or statute, they may have the force and effect of law…. In the narrower sense Executive orders and proclamations are written documents denominated as such…. Executive orders are generally directed to, and govern actions by, Government officials and agencies. They usually affect private individuals only indirectly. Proclamations in most instances affect primarily the activities of private individuals. Since the President has no power or authority over individual citizens and their rights except where he is granted such power and authority by a provision in the Constitution or by statute, the President’s proclamations are not legally binding and are at best hortatory unless based on such grants of authority.”

Access all Executive Orders back to 1994, organized by Administration.
National Archives Disposition Table back to the Franklin D. Roosevelt Administration.
See an academic compilation of Executive Orders at the American Presidency Project.