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Biden on Administrative Law

Monday, January 25, 2021
James M. McElfish, Jr.

James M. McElfish, Jr.

Senior Attorney; Director, Sustainable Use of Land Program

An incoming administration stocked with veterans of prior government service is uniquely suited to appreciate the central role of administrative law in American governance. But the day-one actions of the Biden Administration put an exclamation point on this observation.

On the afternoon of January 20, President Biden signed a stack of Executive Orders and Memoranda setting his Administration on a new course. Many of these aimed at undoing actions of his predecessor in office. But environmental lawyers and administrative law afficionados should be particularly interested in the contents of two of these documents. One, a Presidential Memorandum entitled Modernizing Regulatory Review, sets forth a radically new and forward-leaning view of the role of regulation (and of regulatory processes) in accomplishing societal goals. I use the term “radically” in its technical sense—“at the root” of the incoming Administration’s apparent approach. The second document is an Executive Order revoking certain Trump Administration orders.

White HouseThe Memorandum, after setting forth the president’s general support for the processes set out in Executive Order Nos. 12866 (1993) and 13563 (2011) concerning review of proposed regulations by the Office of Management and Budget’s Office of Information and Regulatory Affairs (OIRA), identifies key national challenges that require federal action. These include the global pandemic, the economic downturn, systemic racial inequality, and climate change. The Memorandum sets in motion an evaluation of “the processes and principles that govern regulatory review” with the goal of ensuring “swift and effective” federal action. The Memorandum says that “regulations that promote the public interest are vital for tackling national priorities.” This day-one action expresses an assertive view of the good that regulations can do—not treating this instrument of governance as a last resort or as economically suspect.

The Memorandum tasks the Director of OMB (not yet confirmed), in consultation with executive departments and agencies, with developing recommendations to improve and modernize regulatory review. Under existing Executive Orders, for four decades, such review has been focused on economic efficiency, avoidance of regulatory costs, and cost-benefit analysis. However, the Biden Memorandum requires OMB, in consultation with federal agencies and departments, to produce recommendations for how the regulatory review process can “promote” a list of outcomes. Specifically, it must generate proposals that would “ensure that regulatory review serves as a tool to affirmatively promote regulations that advance” these values:

  • Public health and safety;
  • Economic growth;
  • Social welfare;
  • Racial justice;
  • Environment stewardship;
  • Human dignity;
  • Equity; and
  • Interests of future generations.

This is a suggestive list. Look at what the National Environmental Policy Act said in 1970, in language described as “supplementary to [the policies and goals] set forth in existing authorizations of Federal agencies.” (NEPA §105): “The Congress authorizes and directs that, to the fullest extent possible: the policies, regulations, and public laws of the United States shall be interpreted and administered in accordance with the policies set forth in this chapter.” (NEPA §102(1)). The policies to be embodied in the interpretation and administration of the laws of the United States are:

  1. fulfill the responsibilities of each generation as trustee of the environment for succeeding generations;
  2. assure for all Americans safe, healthful, productive, and aesthetically and culturally pleasing surroundings;
  3. attain the widest range of beneficial uses of the environment without degradation, risk to health or safety, or other undesirable and unintended consequences;
  4. preserve important historic, cultural, and natural aspects of our national heritage, and maintain, wherever possible, an environment which supports diversity, and variety of individual choice;
  5. achieve a balance between population and resource use which will permit high standards of living and a wide sharing of life’s amenities; and
  6. enhance the quality of renewable resources and approach the maximum attainable recycling of depletable resources. (NEPA §101(b)

The Biden Memorandum sees these goals as not only proper, but necessary, subjects of regulatory review when tackling the list of national priorities. The January 20 Memorandum also directs OMB to modernize and revise as necessary OMB Circular A-4, governing regulatory analysis, to include consideration of new developments in science and economics, to account for regulatory benefits that are not readily quantifiable (e.g., justice, equity), and to propose procedures that take into account the distributional consequences of regulations. It will no longer be sufficient to ascertain that benefits outweigh costs, and that results are efficient. In addition, procedures will be developed to identify winners and losers and specifically to “ensure that regulatory initiatives appropriately benefit and do not inappropriately burden disadvantaged, vulnerable, or marginalized communities.” Justice, not just economics, must have a role. A recent paper by Melissa Luttrell and Jorge Roman-Romero in the Yale Journal on Regulation suggests what kinds of values might matter here.

Finally, the Memorandum seeks an active role for OIRA in identifying and promoting regulatory initiatives that are likely to yield significant benefits (and not simply avoided costs).

The Executive Order signed the same day revokes a substantial list of Trump Administration orders on regulatory process topics. These include: Executive Order No. 13771 (Reducing Regulation and Controlling Regulatory Costs), Executive Order No. 13777 (Enforcing the Regulatory Reform Agenda), Executive Order No. 13875 (Evaluating and Improving the Utility of Federal Advisory Committees), Executive Order No. 13891 (Promoting the Rule of Law Through Improved Agency Guidance Documents), Executive Order No. 13892 (Promoting the Rule of Law Through Transparency and Fairness in Civil Administrative Enforcement and Adjudication), and Executive Order No. 13893 (Increasing Government Accountability for Administrative Actions by Reinvigorating Administrative PAYGO).

With respect to the affirmative regulatory review agenda of the new Administration, the revocation of EO 13771 is significant. This is the Trump order that required the repeal of two regulations for every new one adopted, and which, more significantly, required federal agencies to adhere to a regulatory cost budget established annually by OMB. This budget limited each federal agency to the imposition of only a specific dollar figure of regulatory costs each year, with no consideration of regulatory benefits; and indeed OMB could and did set negative cost requirements for agencies—including EPA—requiring that the net effect of all regulatory actions produce a net reduction in costs, regardless of any benefits achieved. Such a narrow lane for regulatory actions is contrary to everything in the Biden Memorandum.

EO 13777 likewise set in motion the deregulatory agenda of the Trump Administration, including task forces and deregulatory officers in all federal agencies. The Biden Executive Order not only revokes this EO, but specifically states that all regulatory reform office positions and deregulatory task forces are abolished.

Many other first-day actions occurred related to administrative law. But it’s important to see these two executive actions as defining regulation as a force for positive progress on national priorities, an expansion of the kinds of interests that should be taken into account by OMB and the agencies, and a commitment to a broad view of the common good and the role of government.

All blog posts are the opinion of its author(s) and do not necessarily reflect the views of ELI the organization or its members.