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Center for Progressive Reform :: CPR’s Eye on OIRA

Center for Progressive Reform :: CPR’s Eye on OIRA.

 

CPR’s Eye on OIRA

Public Scrutiny for an Unnoticed Regulatory Powerhouse

The Office of Information and Regulatory Affairs has an unenviable reputation. The media can’t seem to resist calling it “obscure,” and often refer to its director as the “regulatory czar.” Among progressives, it’s regarded as an unduly sympathetic ally of industry lobbyists trying to water down or kill protective regulations.
In fact, all those things are more or less true. It’s “obscure” because most people have no idea what it does; its director is fairly described as a “czar” (within the meaning of the term in Washington, not in pre-revolutionary Russia!) because he wields extraordinary power over the regulatory structure; and it is clearly the place where industry lobbyists pitch their tent, hoping to delay, dilute, distort, or defang protective regulations.
OIRA is one other thing, as well. It is also the office that forces regulatory agencies to subject proposed regulations to systemically flawed cost-benefit analysis – a method of regulatory impact analysis that overstates the costs of protective regulations to industry (largely by relying on inflated industry estimates) and understates the benefits of such regulations (often by simply ignoring those that do not carry a price tag).

       Quick Eye on OIRA Links

So for example, one EPA cost-benefit analysis calculated the worth of IQ points that children lose to in utero mercury poisoning by “guesstimating” the impact on the children’s future earnings. (The analysis also treated the diminished likelihood that the children would attend college as a cost savings – weighing in on the side of not bothering to regulate mercury!) Absent from the analysis because they don’t lend themselves to conversion into dollars and cents were some obvious points: that money alone doesn’t make up for brain damage, and that no parent would “sell” their child’s IQ points. Such cost-benefit analysisoutrages are all too common. Significantly, most of the statutes under which agencies regulate call for some other form of regulatory impact analysis; cost-benefit is only rarely required by law. It is imposed by executive order not by statute, and could be just as easily “un-imposed” by a President inclined to remove what was intended to be, and has plainly become, a tool for scuttling protective regulations.
An “obscure” government agency that wields outsized power is in dire need of scrutiny. That’s exactly the rationale for CPR’s Eye on OIRA project, launched in 2010 to monitor and report on the activities of the Office of Information and Regulatory Affairs. The project does not exist solely to scold OIRA. When the office is supportive of protective regulations and regulatory agencies, when it plays a constructive role in the regulatory process, CPR Member Scholars praise the agency. When OIRA strays, however, overstepping its mandate or serving as a conduit for industry complaints, the Member Scholars say so.
For a primer on OIRA’s function and authority, read OIRA 101.  To see what rules are where at OIRA, check out OIRA’s online dashboard.

The Latest Scoop: Sunstein Departs

On August 3, 2012, Cass Sunstein announced his departure from the Office of Information and Regulatory Affairs. CPR President Rena Steinzor issued the following statement:

Cass Sunstein brought impressive credentials and a personal relationship with the President to his job as Administrator of the Office of Information and Regulatory Affairs. But in the final analysis, Sunstein has continued the Bush Administration’s tradition of using the office to block needed health and safety protections disliked by big business and political contributors. Worse, the narrative that Sunstein helped craft about the impact of regulations on American life — that regulatory safeguards are fundamentally suspect — was discordant with the rest of the President’s agenda and the arguments he makes for his reelection.

Sunstein’s departure is an opportunity for the Administration to reset its regulatory policy and embrace public health and safety protections that have long been stalled in the White House. But the President first needs to rethink what he wants from OIRA and its administrator. The middle of a presidential campaign is a lousy time to do that. Sending a nominee into the mosh pit of a Senate confirmation hearing right now would do nothing to advance the cause of a progressive regulatory agenda. The President should take his time and find an Administrator dedicated to protecting the public. Allowing OIRA to serve on behalf of the White House as the last refuge for disgruntled polluters, Wall Street speculators, and producers of tainted food will not prevent the inevitable next wave of health and safety disasters, killing and injuring refinery workers, miners, children who labor in the fields, and the environment of the Gulf coast.

CPR’s Report on OIRA Meetings and Outcomes

Over the years, OIRA’s pattern became familiar: an agency sends over a protective rule for review; industry meets with OIRA to complain about the rule (often several times); and then, behind closed doors, OIRA presses the agency to dilute or delay the rule, leaving people and the environment inadequately protected against unreasonable risks. The EPA’s rules for controlling coal ash waste and ozone pollution, the FDA’s rule to reduce salmonella contamination in eggs, and NHTSA’s rule on fuel efficiency labels for tires—all are telling examples of OIRA’s influence over the regulatory system.
To what degree are those individual instances reflective of larger trends at OIRA? To answer that question, in November 2011, the Center for Progressive Reform released the results of a comprehensive examination of OIRA’s work, conducted by CPR President Rena Steinzor, CPR Intern Michael Patoka, and CPR Policy Analyst James Goodwin. The report, Behind Closed Doors at the White House: How Politics Trumps Protection of Public Health, Worker Safety and the Environment, is the first-ever study to document empirically the extent of OIRA’s interference with regulatory agencies’ statutory missions.
The report reviews 10 years’ worth of data on OIRA’s meetings with outside groups and status reports for completed rule reviews—the only information on OIRA’s activities that are publicly available. It finds that industry has taken advantage of OIRA’s “all-you-can-meet” policy to dominate the OIRA meetings process: Industry representatives meet with OIRA five times more frequently than do public interest group representatives.
It also finds that industry’s meetings achieve the desired result: Rules that were the subject of meetings were 29 percent more likely to be changed during the review than those that were not the subject of meetings. Almost invariably, OIRA’s influece operates as a one-way ratchet, weakening safeguards that protect the public and the environment in order to protect regulated industry’s bottom line. Lastly, it finds that the EPA is disproportionately burdened by this process. Even though the EPA’s rules comprised only 11 percent of all those reviewed by OIRA, 41 percent of all meetings at OIRA related to EPA rules. Other agencies’ rules are changed a lot during OIRA review—about 65 percent of the time—but EPA rules are changed even more frequently than that—a whopping 84 percent of the time. Read more about the report, read the full report or read just the executive summary. Explore the searchable database, which compiles all the data on OIRA meetings and rule reviews used in the report.

Rules Currently Under Review at OIRA

  • National Forest System Land Management Planning (USDA – Forest Service) (under review since Nov. 18, 2011)
  • Produce Safety Regulation (FDA) (under review since December 9, 2011)
  • Standards for Living Organisms in Ships’ Ballast Water Discharged in U.S. Waters (DHS – U.S. Coast Guard) (under review since Nov. 11, 2011)
  • Injurious Wildlife Evaluation; Constrictor Species from Python, Boa, and Eunectes Genera (Department of the Interior – Fish and Wildlife Service) (under review since March 30, 2011) [in violation of Executive Order 12866 since July 29, 2011]
  • Proximity Detection Systems for Mobile Machines in Underground Mines (MSHA) (under review since Sept. 16, 2011)
  • Occupational Exposure to Silica (OSHA) (under review since Feb. 14, 2011) [in violation of Executive Order 12866 since Jun. 14, 2011]
  • Hazard Communication (OSHA) (under review since Oct. 25, 2011)
  • Flight and Duty Limits and Rest Requirements for Pilots (FAA) (under review since Aug. 17, 2011)
  • Hours of Service (DOT – Federal Motor Carrier Safety Administration) (under review since Nov. 1, 2011)
  • Federal Motor Vehicle Safety Standard No. 111, Rearview Mirrors (NHTSA) (under review since Nov. 16, 2011)
  • National Emission Standards for Hazardous Air Pollutants From Coal- and Oil-Fired Electric Utility Steam Generating Units and Standards of Performance for Electric Utility Steam Generating Units (EPA) (under review since Nov. 7, 2011)
  • Greenhouse Gas New Source Performance Standard for Electric Generating Units (EPA) (under review since Nov. 7, 2011)
  • Nanoscale Materials, Reporting Under TSCA Section 8(a) (EPA) (under review since Nov. 22, 2010) [in violation of Executive Order 12866 since Mar. 22, 2011]
  • Chemicals of Concern List (EPA) (under review since May 12, 2010) [in violation of Executive Order 12866 since September 10, 2010]
  • OSWER Guidance on Developing an Interim Preliminary Remediation Goal for Dioxin in Residential Soil at CERCLA and RCRA Sites (EPA) (under review since August 10, 2010) [in violation of Executive Order 12866 since December 9, 2010]

Recently Completed Rule Reviews

  • Drivers of Commercial Vehicles: Restricting the Use of Cellular Phones (DOT – Federal Motor Carrier Safety Administration) (review completed Nov. 21, 2011)
  • Passenger Car and Light Truck Corporate Average Fuel Economy Standards MYs 2017 and Beyond (NHTSA/EPA) (review completed Nov. 16, 2011)
  • National Emission Standards for Hazardous Air Pollutants for Major Sources: Industrial, Commercial, and Institutional Boilers and Process Heaters; Proposed Reconsideration (EPA) (review completed December 2, 2011)
  • National Emission Standards for Hazardous Air Pollutants for Area Sources: Industrial, Commercial, and Institutional Boilers; Reconsideration and Proposed Rule Amendments (EPA) (review completed December 2, 2011)

Other Recent OIRA Activity

The big regulatory news last fall was President Obama’s announcement that he was directing EPA to table its proposed revisions to the National Ambient Air Quality Standards for ozone, which had been under review at OIRA since July 11, 2011. EPA is required by law to revisit the standards every five years, but the Bush Administration let a 1997 revision sit unchanged for a full decade. When the Bush EPA finally acted, it ignored the recommendations of its scientific advisory panel, setting an ozone standard that allowed pollution at levels the panel considered unsafe.
Environmental organizations sued, and eventually President Obama’s EPA Administrator, Lisa Jackson, settled with the organizations, promising to revise the standards by 2010. EPA missed the deadline, but in July 2011 sent revised standards to OIRA for review. On September 3, President Obama told EPA to shelve the standards, leaving in place the 1997 standards until at least 2013, when EPA is set to next review them. The President’s stated rationale: to ease the economic burden the regulations would cause the nation’s polluters.
Overlooked in the President’s reasoning was the effect on Americans’ health. The consequence of delaying the standards, according to EPA’s estimates, will be 4,300 additional American deaths from air-pollution-related causes.
Read op-eds by Rena Steinzor (Baltimore Sun)David Driesen (Syracuse Post-Standard), and Thomas McGarity (Houston Chronicle). Read blogs on the subject by three CPR Member Scholars, Rena SteinzorThomas McGarity, and Victor Flatt.
Ground level ozone pollution causes smog, and is a respiratory irritant that increases the frequency and severity of asthma attacks. It has been linked to such cardiopulmonary events as heart attacks in people with underlying heart disease. The EPA’s proposed standards would have tightened the ambient air quality standards for ozone to reflect the recommendations of the EPA’s Clean Air Scientific Advisory Committee (CASAC). As noted, the CASAC had made that recommendation in 2008 when the standards were due for periodic review under the Clean Air Act. But the Bush administration declined to follow the recommendation and instead adopted considerably looser standards.

 
The ozone rules have been a prime target for industry. John Engler, president of the Business Roundtable, said that the ozone rules were “the biggest test so far of Obama’s seriousness in creating jobs.” Industry interests like the American Petroleum Institute went so far as to publish competing economic analyses of the impact of lowering the ozone standard.
For its part, OIRA hosted seven meetings with interest groups on the ozone rules, most, unusually, with environmental groups. But while industry had fewer trips to OIRA on the subject, it was hardly underrepresented. Industry’s two meetings included an August 16 meeting that gathered representatives of the Chamber of Commerce, American Chemistry Council, American Petroleum Institute, National Association of Manufacturers, American Forest and Paper Association, National Petroleum Refiners Association. White House Chief of Staff William Daley also attended.
Meanwhile, Members of Congress applied direct political pressure. Sen. James Inhofe (R-Okla.) called into question whether the CASAC was actually an impartial body. An August 4 letter from Inhofe asked the EPA Inspector General to investigate the public stances about ozone standards of scientists on the CASAC. Similarly, Rep. Fred Upton (R-Mich.) wanted EPA Administrator Lisa Jackson to provide him with legal analysis to explain why EPA has the legal authority to review the ozone standards.
Rep. Nick Rahall Pushed for OIRA Delay of Clean Water Act Guidance on Mountaintop Removal Permits. In April 2010, EPA published a notice requesting comments on revised guidance related to EPA review of Appalachian surface coal mining under the Clean Water Act. The agency took comments on the proposed changes for six months and received several hundred public comments on the proposal.
On Mar. 29, 2011, two days before EPA was planning to release an updated guidance document on issuing Clean Water Act permits, Rep. Nick Rahall (D-W.Va.) sent a letter to OIRA stating that EPA had violated OMB’s good guidance practices, and requested that OIRA review EPA’s guidance document. Inside EPA reported that an EPA spokesperson expects the guidance document to be published in “early summer,” but it is still under review at OIRA.
The Bush administration’s Executive Order 13,422 expanded OIRA’s authority to review guidance documents. When President Obama took office, one of his first acts was to repeal the Bush Executive Order. But on Mar. 4, 2009, Peter Orszag, then director of the Office of Management and Budget, issued a memo backpedaling on OIRA review guidance documents. Several CPR Board Members sent aletter to the White House General Counsel explaining that the Orszag memo violated Obama’s order.
For all intents and purposes, Representative Rahall is using OIRA review to delay the EPA guidance while he works legislatively to strip EPA’s authority to veto permits under the Clean Water Act. On Jun. 22, the House Transportation and Infrastructure Committee, of which Rahall is the Ranking Member, reported a bill to give regulatory authority over water, wetlands, and mountaintop mining to the states. EPA released a legal analysis on Jun. 24 that explains that the bill would gut the Clean Water Act and “would overturn almost 40 years of federal legislation by preventing EPA from protecting public health and water quality.”
Chamber of Commerce Urges OIRA to Halt Year-Long Review of EPA’s Proposed Chemicals of Concern List. On Jun. 7, 2011, the U.S. Chamber of Commerce sent a letter to OIRA requesting that it halt its review of EPA’s proposed Chemicals of Concern list until the agency released its guidance for selecting which chemicals to place on the list. The proposed list includes high-profile chemicals including bisphenol A (BPA), several phthalates, and flame retardant chemicals. The proposed list has been under review at OIRA since May 12, 2010.
The Chamber of Commerce complained that EPA had considered listing these chemicals before publicly issuing “clear, scientifically sound and economically rational listing criteria.” The group claimed that EPA had violated Executive Orders regarding OIRA review of regulatory actions.
On Jun. 20, 2011, CPR President Rena Steinzor, and CPR Member Scholars Noah Sachs and Wendy Wagner sent a letter to OIRA in response to the Chamber of Commerce’s letter. The Member Scholars’ letter stressed that if the Chamber of Commerce has concerns with EPA’s proposed list it should air them during a public comment process. In the meantime, they said, OIRA should complete its review and send the proposed list back to EPA, so that a public comment period can begin.
The Chamber of Commerce complains that EPA has not explained what it means when a listed chemical “may present” an “unreasonable risk.” But a regulatory proposal, like the one currently stalled at OIRA, would be exactly the avenue for EPA to define terms. The Chamber of Commerce, among other stakeholders, could evaluate and critique EPA’s definitions out in the open. Then, after reviewing all comments received, the agency could make a final determination.

CPR’s Work on OIRA:

  • Eye on OIRA, soup to nuts:  Read all Eye on OIRA posts on CPRBlog.
  • Scoring Political Points with the Regulatory Look-Back: In May 2011, OIRA Administrator Cass Sunstein penned an op-ed in theWall Street Journal and delivered a speech at the American Enterprise Institute touting the preliminary results of the Administration’s regulatory look-back, announced by the President in January. As the look-back was originally framed, agencies would examine current regulations to seek out — and eventually revise — rules that were redundant, had been overtaken by technology, were no longer necessary, or needed to be expanded. In his May announcement, Sunstein focused his discussion exclusively on regulations to be eliminated or weakened. CPR’s Amy Sinden responded with a blog post taking the Administration to task for its anti-regulatory rhetoric, for failing to follow through on its promise to seek out areas where regulation needed to be expanded, and for ginning up the look-back as a largely political exercise that would divert agencies from their urgent work.
  • Launching the Obama Regulatory ‘Look-Back’:  The GOP majority in the House of Representatives is working to advance legislation designed to gum up the regulatory system — calling it the REINS Act. (Read Member Scholar Sidney Shapiro’s editorial memorandum on the subject.) In January 2011, President Obama responded to the GOP’s anti-regulatory initiative by launching one of his own. In an op-ed in the Wall Street Journal, the President announced that he would direct agencies to “look back” at existing regulations with the goal of identifying those “that conflict, that are not worth the cost, or that are just plain dumb.” As CPR President Rena Steinzor pointed out, in the process of launching the initiative, the President adopted the frame for the conversation that the GOP has put forward: that regulations are a drag on the economy. In fact, as Steinzor argued in a number of media placements, there’s no evidence of that. Moreover, she observed, the initiative will distract agencies from the much more important work of addressing pressing regulatory needs — like climate change, unsafe workplaces, unsafe automobiles and more. Read Steinzor’s blog on the subject.
  • Coal Ash Comments. Rena Steinzor’s November 19, 2010 comments to EPA on its proposed coal ash regulation have sharp criticism for OIRA’s extended review of EPA’s 2009 proposal to regulate coal ash. Along the way, OIRA violated the executive order establishing its authority to review regulations by missing its deadlines, then imposed on EPA an alternative, watered-down, regulation, and then saddled EPA’s original proposal with a cost-benefit analysis that would make it all but impossible for EPA to describe plainly hazardous coal ash as a hazard.  Read Rena Steinzor’s 2010 comments on EPA’s proposal and OIRA’s role in the process.  Read the news release.  Read a CPRBlog post.
  • Did OIRA Help Cause the Recent Salmonella Outbreak? One of the stories that emerged in the wake of the massive egg recall in August was that the Food & Drug Administration had recently issued a new rule meant to prevent salmonella contamination in eggs, but the rule was issued just a few months after the salmonella outbreak began. In these kinds of “near miss” situations, it is natural to ask questions like: Could the FDA have issued the rule a few months earlier? And, if so, why didn’t it? As it turns out, OIRA may have interfered with the rule in November of 2008, possibly delaying the rule’s completion by half a year or even longer. A September 1, 2010, CPRBlog post examines the facts surrounding this instance of potential OIRA interference with catastrophic consequences.
  • OIRA and Cock Roaches? Read Rena Steinzor’s August 30, 2010 testimony before an EPA panel conducting regional hearings on regulating coal ash, in which she explains why the supposedly “irrational” refusal of human test subjects to drink a glass of water from which a cock roach had just been removed is at the heart of OIRA’s extraordinary rationale for tilting a cost-benefit analysis against regulating coal ash.
  • OIRA and Transparency: Despite the Obama Administration’s commitment to transparency in government, OIRA is operating in opaque mode, according to a June 22, 2010 CPRBlog post from Rena Steinzor.
  • OMB Report to Congress. OMB submits annual reports to Congress on the benefits and costs of federal regulation. And like clockwork, CPR Member Scholars analyze the submission and respond.  Read the2010  response from Sidney Shapiro, Amy Sinden, Rena Steinzor, and James Goodwin. Their four main points: OMB’s habit of providing Congress with aggregate costs and benefits of regulation is “fundamentally counterproductive” and OMB should abandon it; the report makes clear that OIRA intends to continue “micromanaging agency decisionmaking,” even though the agencies are the ones with mandates from Congress; while the report’s call for transparency is laudable, the recommendations “are incomplete”; and the Interagency Task Force approach used to develop a proposed value for the social costs of carbon, an approach OMB holds up in its reort as a model of transparency, was anything but transparent — the task force’s members were never revealed and it took no public comments, while using flawed economic models, data and assumptions. Here’s OMB’s report.  Read more about OMB’s annual reports to Congress.
  • Coal Ash. After a months-long struggle between EPA and OIRA, on May 3, 2010, EPA released not one but three proposals for dealing with the problem of hazardous coal ash waste.  EPA sent a proposed rule to OIRA in mid-October 2009, starting a 120-day clock for OIRA’s consideration of the proposal.  What followed was a massive lobbying blitz by the industry, that included more than 40 meetings with OIRA staff — all to talk about a rule whose substance was the province of EPA, not OIRA.  In February, the clock expired, but no rule emerged, and neither, for that matter, did an explanation as to why the time had run out without action. CPR’s review of the paper trail between between EPA and OIRA, subsequently released by EPA, shows exactly how EPA’s proposal came to be watered down.  Read all about it, here and here. Read all CPRBlog entries on coal ash.
  • OIRA’s First Review Letter of the Obama Administration. On March 19, 2010, Administrator Cass Sunstein issued OIRA’s firstReview Letter of the Obama Administration, offering guidance to the Administrator of the National Highway Traffic Safety Administration (NHTSA) on how to implement the agency’s new “Tire Fuel Efficiency Consumer Information Program.” Under this program, NHTSA must develop a system of fuel efficiency ratings for tires, which consumers can consider when deciding which replacement tires to buy for their cars. OIRA’s Review Letter directs the agency to employ behavioral economics principles, such as “clarity” and “transparency and meaning,” when designing the labels for communicating the ratings to customers. For background on the different type of OIRA letters, see here.

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