On February 2, 2017, the Office of Information and Regulatory Affairs (OIRA) issued Guidance in order to clarify last week’s Executive Order (EO) regarding the issuance of administrative rules. The EO requires agencies to identify at least two existing regulations to be repealed for every one newly promulgated regulation. The EO also requires the total incremental costs of all new regulations finalized in Fiscal Year (FY) 2017 to be offset by eliminating costs associated with repealed regulations.

The Guidance clarifies that the EO only applies to significant regulatory actions – rules with annual compliance costs of $100 million per year — issued between January 20 and September 30, 2017 (the end of the fiscal year). The EO’s applicability to new “significant” guidance documents will be addressed on a “case-by-case” basis. Purely deregulatory actions that only confer savings generally will not be subject to the EO.

The Guidance states that, to the extent feasible, regulatory actions should be eliminated before or on the same schedule as the new regulatory action they offset. Savings will be measured as the opportunity cost to society, annualized in accordance with existing OIRA guidance. Previously estimated regulatory costs under Regulatory Impact Analyses will not be used. Savings may also be transferred between agencies by submitting a formal request to OIRA for a waiver, which should be made before submitting a regulatory action for review. OIRA Desk Officers are charged with reviewing agency compliance with the new requirements.

For more information on this Guidance, please contact Peter Glaser, Andrea Wortzel, or Rich Pepper.