On January 11, the ABA announced that the Task Force on Federal Lobbying Laws, organized by the ABA Administrative Law and Regulatory Practice Section, had issued a report that recommends changes in various provisions of federal lobbying laws. In brief, the report, according to the ABA press release, recommends (1) greater transparency with respect to outside firms that lobbyists retain to do additional work and with respect to lobbyists' identification of specific legislative or executive offices that they plan to contact; (2) a two-year prohibition on lobbyists who advocate a position before a Member of Congress fundraising for that Member, and on fundraisers for a Member lobbying that Member; (3) restrictions on lobbyists who seek earmarks or other narrow financial benefits from Congress, including a ban on contingent fees; and (4) assignment of lobbying enforcement to a regulatory body such as the Civil Division of the Department of Justice, and assignment of appropriate administrative powers to that body.
On January 18, C-SPAN broadcast a discussion of the report by the Task Force's Co-Chair, Trevor Potter. The Harvard Law School News also issued a press release about the report that featured another Task Force Co-Chair, Professor Charles Fried.
Tuesday, January 18, 2011
Regulatory Policy: President Issues Executive Order on Regulatory Review
On January 18, President Obama issued a new Executive Order on "Improving Regulation and Regulatory Review." The Executive Order supplements and reaffirms the principles, structures, and definitions governing contemporary regulatory review that were established in Executive Order 12866, and mostly sets forth broad principles applicable to regulation and regulatory review.
Subsection 1(a) of the Executive Order states generically that
"[o]ur regulatory system must protect public health, welfare, safety, and our environment while promoting economic growth, innovation, competitiveness, and job creation"; "be based on the best available science"; "allow for public participation and an open exchange of ideas'; "promote predictability and reduce uncertainty"; "identify and use the best, most innovative, and least burdensome tools for achieving regulatory ends"; "take into account benefits and costs, both quantitative and qualitative"; "ensure that regulations are accessible, consistent, written in plain language, and easy to understand"; and "measure, and seek to improve, the actual results of regulatory requirements."
Subsection 1(b) states that "each agency must, among other things: (1) propose or adopt a regulation only upon a reasoned determination that its benefits justify its costs (recognizing that some benefits and costs are difficult to quantify); (2) tailor its regulations to impose the least burden on society, consistent with obtaining regulatory objectives, taking into account, among other things, and to the extent practicable, the costs of cumulative regulations; (3) select, in choosing among alternative regulatory approaches, those approaches that maximize net benefits (including potential economic, environmental, public health and safety, and other advantages; distributive impacts; and equity); (4) to the extent feasible, specify performance objectives, rather than specifying the behavior or manner of compliance that regulated entities must adopt; and (5) identify and assess available alternatives to direct regulation, including providing economic incentives to encourage the desired behavior, such as user fees or marketable permits, or providing information upon which choices can be made by the public."
Section 2 directs that "[r]egulations shall be adopted through a process that involves public participation"; that each agency "shall endeavor to provide the public with an opportunity to participate in the regulatory process'; and that "[b]efore issuing a notice of proposed rulemaking, each agency, where feasible and appropriate, shall seek the views of those who are likely to be affected, including those who are likely to benefit from and those who are potentially subject to such rulemaking."
Section 3 states that "[i]n developing regulatory actions and identifying appropriate approaches, each agency shall attempt to promote" interagency coordination as well as simplification and harmonization of rules; and "shall also seek to identify, as appropriate, means to achieve regulatory goals that are designed to promote innovation." Section 4 states that "[w]here relevant, feasible, and consistent with regulatory objectives, and to the extent permitted by law, each agency shall identify and consider regulatory approaches that reduce burdens and maintain flexibility and freedom of choice for the public." Section 5 states that "each agency shall ensure the objectivity of any scientific and technological information and processes used to support the agency's regulatory actions."
Section 6 is the section that creates the most specific new obligation for federal agencies. Subsection 6(a) states that "[t]o facilitate the periodic review of existing significant regulations, agencies shall consider how best to promote retrospective analysis of rules that may be outmoded, ineffective, insufficient, or excessively burdensome, and to modify, streamline, expand, or repeal them in accordance with what has been learned." It also specifies that such retrospective analyses, "including supporting data, should be released online whenever possible." Subsection 6(b) provides that within 120 days of January 18, 2011, "each agency shall develop and submit to the Office of Information and Regulatory Affairs a preliminary plan, consistent with law and its resources and regulatory priorities, under which the agency will periodically review its existing significant regulations to determine whether any such regulations should be modified, streamlined, expanded, or repealed so as to make the agency's regulatory program more effective or less burdensome in achieving the regulatory objectives."
In a January 18 op-ed piece in the Wall Street Journal, the President explains that this regulatory review "will help bring order to regulations that have become a patchwork of overlapping rules, the result of tinkering by administrations and legislators of both parties and the influence of special interests in Washington over decades." He concludes with the observation that "[t]his is the lesson of our history: Our economy is not a zero-sum game. Regulations do have costs; often, as a country, we have to make tough decisions about whether those costs are necessary. But what is clear is that we can strike the right balance. We can make our economy stronger and more competitive, while meeting our fundamental responsibilities to one another."
Subsection 1(a) of the Executive Order states generically that
"[o]ur regulatory system must protect public health, welfare, safety, and our environment while promoting economic growth, innovation, competitiveness, and job creation"; "be based on the best available science"; "allow for public participation and an open exchange of ideas'; "promote predictability and reduce uncertainty"; "identify and use the best, most innovative, and least burdensome tools for achieving regulatory ends"; "take into account benefits and costs, both quantitative and qualitative"; "ensure that regulations are accessible, consistent, written in plain language, and easy to understand"; and "measure, and seek to improve, the actual results of regulatory requirements."
Subsection 1(b) states that "each agency must, among other things: (1) propose or adopt a regulation only upon a reasoned determination that its benefits justify its costs (recognizing that some benefits and costs are difficult to quantify); (2) tailor its regulations to impose the least burden on society, consistent with obtaining regulatory objectives, taking into account, among other things, and to the extent practicable, the costs of cumulative regulations; (3) select, in choosing among alternative regulatory approaches, those approaches that maximize net benefits (including potential economic, environmental, public health and safety, and other advantages; distributive impacts; and equity); (4) to the extent feasible, specify performance objectives, rather than specifying the behavior or manner of compliance that regulated entities must adopt; and (5) identify and assess available alternatives to direct regulation, including providing economic incentives to encourage the desired behavior, such as user fees or marketable permits, or providing information upon which choices can be made by the public."
Section 2 directs that "[r]egulations shall be adopted through a process that involves public participation"; that each agency "shall endeavor to provide the public with an opportunity to participate in the regulatory process'; and that "[b]efore issuing a notice of proposed rulemaking, each agency, where feasible and appropriate, shall seek the views of those who are likely to be affected, including those who are likely to benefit from and those who are potentially subject to such rulemaking."
Section 3 states that "[i]n developing regulatory actions and identifying appropriate approaches, each agency shall attempt to promote" interagency coordination as well as simplification and harmonization of rules; and "shall also seek to identify, as appropriate, means to achieve regulatory goals that are designed to promote innovation." Section 4 states that "[w]here relevant, feasible, and consistent with regulatory objectives, and to the extent permitted by law, each agency shall identify and consider regulatory approaches that reduce burdens and maintain flexibility and freedom of choice for the public." Section 5 states that "each agency shall ensure the objectivity of any scientific and technological information and processes used to support the agency's regulatory actions."
Section 6 is the section that creates the most specific new obligation for federal agencies. Subsection 6(a) states that "[t]o facilitate the periodic review of existing significant regulations, agencies shall consider how best to promote retrospective analysis of rules that may be outmoded, ineffective, insufficient, or excessively burdensome, and to modify, streamline, expand, or repeal them in accordance with what has been learned." It also specifies that such retrospective analyses, "including supporting data, should be released online whenever possible." Subsection 6(b) provides that within 120 days of January 18, 2011, "each agency shall develop and submit to the Office of Information and Regulatory Affairs a preliminary plan, consistent with law and its resources and regulatory priorities, under which the agency will periodically review its existing significant regulations to determine whether any such regulations should be modified, streamlined, expanded, or repealed so as to make the agency's regulatory program more effective or less burdensome in achieving the regulatory objectives."
In a January 18 op-ed piece in the Wall Street Journal, the President explains that this regulatory review "will help bring order to regulations that have become a patchwork of overlapping rules, the result of tinkering by administrations and legislators of both parties and the influence of special interests in Washington over decades." He concludes with the observation that "[t]his is the lesson of our history: Our economy is not a zero-sum game. Regulations do have costs; often, as a country, we have to make tough decisions about whether those costs are necessary. But what is clear is that we can strike the right balance. We can make our economy stronger and more competitive, while meeting our fundamental responsibilities to one another."
Wednesday, January 12, 2011
Adjudication/Judicial Review/Tax: Supreme Court January 11 Decision in Mayo Foundation v. United States
On January 11, the United States Supreme Court handed down its decision in Mayo Foundation v. United States. Mayo involved a challenge to a Treasury Department regulation providing that the services of full-time employees, which include employees normally scheduled to work 40 hours or more a week, are required to pay taxes under the Federal Income Contributions Act (FICA). The Mayo Foundation and other plaintiffs, which provided doctors in their residency programs with annual "stipends" of more than $40,000 as well as health insurance, malpractice insurance, and paid vacation time, challenged this regulation on the ground that its residents were exempt from taxation under section 3121 of the FICA and that the Treasury regulation was invalid.
Chief Justice Roberts, writing for the Court, held that the Treasury regulation was a permissible construction of section 3121. The Court began by applying the first step of the two-part framework in Chevron U.S.A. Inc. v. NRDC, 467 U.S. 837, 842-43 (1984). It determined that Congress, in the FICA, had not "directly addressed the precise question at issue," as the FICA did not define the term student and did not otherwise address whether medical residents are subject to FICA. (Slip op. at 6.) Although neither the plain text of the statute nor the District Court's interpretation of the exemption spoke with sufficient precision to the issue, the Court determined that the appropriate standard, under the second step in Chevron, was whether the agency's answer is based on a permissible construction of the statute.
In so doing, the Court rejected the multi-factor analysis set forth in National Muffler Dealers Assn., Inc. v. United States, 440 U.S. 472 (1979) for evaluating an ambiguous provision of the Internal Revenue Code. Recognizing "the importance of maintaining a uniform approach to judicial review of admistrative action," Dickinson v. Zurko, 527 U.S. 150, 154 (1999), the Court saw "no reason why our review of tax regulations should not be guided by agency expertise pursuant to Chevron to the same extent as our review of other regulations." (Slip op. at 10.)
The Court concluded that Chevron and United States v. Mead Corp., 533 U.S. 218 (2001), rather than National Muffler and Rowan Cos. v. United States, 452 U.S. 247 (1981), "provide the appropriate framework for evaluating the full-time employee rule." (Slip op. at 11.) Applying that framework, it found that the rule "easily satisfies the second step of Chevron
Chief Justice Roberts, writing for the Court, held that the Treasury regulation was a permissible construction of section 3121. The Court began by applying the first step of the two-part framework in Chevron U.S.A. Inc. v. NRDC, 467 U.S. 837, 842-43 (1984). It determined that Congress, in the FICA, had not "directly addressed the precise question at issue," as the FICA did not define the term student and did not otherwise address whether medical residents are subject to FICA. (Slip op. at 6.) Although neither the plain text of the statute nor the District Court's interpretation of the exemption spoke with sufficient precision to the issue, the Court determined that the appropriate standard, under the second step in Chevron, was whether the agency's answer is based on a permissible construction of the statute.
In so doing, the Court rejected the multi-factor analysis set forth in National Muffler Dealers Assn., Inc. v. United States, 440 U.S. 472 (1979) for evaluating an ambiguous provision of the Internal Revenue Code. Recognizing "the importance of maintaining a uniform approach to judicial review of admistrative action," Dickinson v. Zurko, 527 U.S. 150, 154 (1999), the Court saw "no reason why our review of tax regulations should not be guided by agency expertise pursuant to Chevron to the same extent as our review of other regulations." (Slip op. at 10.)
The Court concluded that Chevron and United States v. Mead Corp., 533 U.S. 218 (2001), rather than National Muffler and Rowan Cos. v. United States, 452 U.S. 247 (1981), "provide the appropriate framework for evaluating the full-time employee rule." (Slip op. at 11.) Applying that framework, it found that the rule "easily satisfies the second step of Chevron
Monday, November 22, 2010
Administrative Conference of the United States: ACUS to Hold November 30 Forum on e-Rulemaking
On November 30, the Administrative Conference of the United States (ACUS) will hold a forum on "Transforming E-rulemaking to Promote Public Participation and Efficiency." Paul Verkuil, ACUS Chair, will provide an introduction to the forum, which will include a keynote address by Cass Sunstein, Administrator of OMB's Office of Information and Regulatory Affairs, and eight distinguished panelists and presenters. The forum will take place from 9:30 a.m. to 12:00 noon at the Brookings Institution, Falk Auditorium, 1775 Massachusetts Avenue, N.W., Washington, D.C. People may register via the forum webpage or by email at info@acus.gov.
Monday, November 15, 2010
Adjudication: AP Reports Growing Number of Threats to Social Security Administration ALJs
On November 14, the Associated Press reported that Social Security Administration (SSA) administrative law judges and staff "are facing a growing number of violent threats from claimants angry over being denied benefits or frustrated at lengthy delays in processing claims." According to the article, SSA data show "[t]here were at least 80 threats to kill or harm administrative law judges or staff over the past year — an 18 percent increase over the previous reporting period."
Sunday, November 14, 2010
Food and Drug: FDA Issues Proposed Rule on Graphic Health Warnings on Cigarette Packaging and Advertisements
On November 12, in a widely reported action, the Food and Drug Administration published in the Federal Register a notice of a proposed rule that would amend FDA regulations "to add a new requirement for the display of health warnings on cigarette packages and in cigarette advertisements. The proposed rule would implement a provision of the Family Smoking Prevention and Tobacco Control Act (Tobacco Control Act) that requires FDA to issue regulations requiring color graphics depicting the negative health consequences of smoking to accompany the nine new textual warning statements that will be required under the Tobacco Control Act. The Tobacco Control Act amends the Federal Cigarette Labeling and Advertising Act (FCLAA) to require each cigarette package and advertisement to bear one of nine new textual warning statements. This proposed rule, once finalized, would specify the color graphics that must accompany each of the nine new textual warning statements."
According to a paper published in the Bulletin of the World Health Organization, "28 countries have introduced pictorial warnings and many other countries are in the process of drafting regulations for pictorial warnings." The comment period on the proposed rule ends January 11, 2011.
According to a paper published in the Bulletin of the World Health Organization, "28 countries have introduced pictorial warnings and many other countries are in the process of drafting regulations for pictorial warnings." The comment period on the proposed rule ends January 11, 2011.
International Trade: President Obama Signs Executive Order Establishing Export Enforcement Coordination Center
On November 10, President Obama signed an Executive Order establishing within the Department of Homeland Security an interagency Federal Export Enforcement Coordination Center (Center). The Executive Order stated that the Center "shall coordinate on matters relating to export enforcement among" seven executive branch departments (i.e., the Departments of Commerce, Defense, Energy, Homeland Security, Justice, State,and the Treasury), as well as the Office of the Director of National Intelligence and other executive branch departments and agencies as the President may designate.
The Executive Order also specified that the Center's functions will include "(a) serv[ing] as the primary forum within the Federal Government for executive departments and agencies to coordinate and enhance their export control enforcement efforts and identify and resolve conflicts that have not been otherwise resolved in criminal and administrative investigations and actions involving violations of U.S. export control laws; (b) serv[ing] as a conduit between Federal law enforcement agencies and the U.S. Intelligence Community for the exchange of information related to potential U.S. export control violations; (c) serv[ing] as a primary point of contact between enforcement authorities and agencies engaged in export licensing; (d) coordinat[ing] law enforcement public outreach activities related to U.S. export controls; and (e) establish[ing] Government wide statistical tracking capabilities for U.S. criminal and administrative export control enforcement activities, to be conducted by the Department of Homeland Security with information provided by and shared with all relevant departments and agencies participating in the Center." (See the August 31 Notice and Comment post that first mentioned the President's intention to create the Center.)
The Executive Order also specified that the Center's functions will include "(a) serv[ing] as the primary forum within the Federal Government for executive departments and agencies to coordinate and enhance their export control enforcement efforts and identify and resolve conflicts that have not been otherwise resolved in criminal and administrative investigations and actions involving violations of U.S. export control laws; (b) serv[ing] as a conduit between Federal law enforcement agencies and the U.S. Intelligence Community for the exchange of information related to potential U.S. export control violations; (c) serv[ing] as a primary point of contact between enforcement authorities and agencies engaged in export licensing; (d) coordinat[ing] law enforcement public outreach activities related to U.S. export controls; and (e) establish[ing] Government wide statistical tracking capabilities for U.S. criminal and administrative export control enforcement activities, to be conducted by the Department of Homeland Security with information provided by and shared with all relevant departments and agencies participating in the Center." (See the August 31 Notice and Comment post that first mentioned the President's intention to create the Center.)
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