During the campaign, President Trump promised to remove two regulations for every new one enacted. On Monday, January 30, 2017, he sought to make good on that promise by signing an Executive Order (EO), titled Reducing Regulation and Controlling Regulatory Costs.

The new EO, applicable to the entire Executive Branch, including all federal administrative agencies, makes a straightforward directive: “for every one new regulation issued, at least two prior regulations be identified for elimination.” The Order goes on to state that the costs associated with any new regulations may not exceed the savings realized by repealing at least two prior regulations (“the total incremental cost of all new regulations . . . shall be no greater than zero.”).

This Order exempts rules related to military, national security or foreign affairs obligations, and it is subject to existing “applicable law,” presumably allowing agencies to pursue rulemaking where directed to by Congress. The Order reserves considerable discretion, however, to the Director of the Office of Management and Budget (OMB), requiring OMB to issue guidance to all agencies on how to implement the Order, and giving OMB sole discretion in making any exceptions to the “2 for 1” edict.  The recently appointed Director of the OMB is Mick Mulvaney, a Congressman from South Carolina, who is a strong fiscal conservative.

The 2 for 1 Executive Order defines “regulation” or “rule” as “an agency statement of general or particular applicability and future effect designed to implement, interpret or describe law or policy . . . .”  This broad definition could arguably encompass agency guidance.  PHMSA has increasingly relied on the issuance of guidance in lieu of regulations, and even though such guidance states that it does not have the force of law, it often shows up in Corrective Action Orders or Compliance Orders as binding requirements.

Despite releasing final regulations for liquid pipelines in a prepublication press release on January 13, 2017 (under the Obama administration), PHMSA withdrew those regulations on January 24, 2017. This withdrawal followed the January 20, 2017 Executive Memorandum instructing agencies to withdraw regulations that had been sent to the Federal Register but not yet published so that they can be reviewed and approved by the new Administration.  The status of the final rule remains unclear, but may be even further attenuated in light of this new EO.