Bill of the Month: The REVIEW Act of 2022

FreedomWorks is excited to recognize the REVIEW Act of 2022 as our Bill of the Month for August 2022. REVIEW creatively stands for “Require Evaluation before Implementing Executive Wishlists”. Introduced by Rep. Jack Bergman (R-MI-1) earlier this month, it currently has five co-sponsors in the House of Representatives. 

Background

  • Under the Administrative Procedure Act and other federal statutes, federal agencies promulgate regulations to enforce federal law. The breadth and scope of these regulations, as well as the subject area and enforcement practices are usually, if not always based on the priorities of the president.
  •  Presidential administrations of both parties have promulgated major or high-impact rules that cost the economy and consumers billions of dollars. 
  • According to the Competitive Enterprise Institute, in 2019, President Trump’s administration promulgated “2,964 final rules, which was the lowest count since records began being kept in the 1970’s and the only ever tally below 3,000.” In 2020, there was a slight uptick to 3,353 final rules, but still well below the average count around 4,000.
  • The Weidenbaum Center at Washington University in St. Louis and the George Washington University Regulatory Studies Center in Washington, D.C., jointly estimate that agencies spent $88 billion in fiscal year 2020 to administer and police the federal regulatory state.
  • According to the Competitive Enterprise Institute’s (CEI) annual report, the total cost of regulatory compliance in 2020 exceeded $1.9 trillion. 
  • In 2021, President Biden’s administration promulgated 3,257 final rules.

The Problem

  • Major regulations are harmful and costly to the economy. Rarely do their benefits ever outweigh their costs. To fight off the cost of complying with these burdensome regulations, corporations and small businesses put the burden on consumers and raise the price of goods or services.
  • In the end, consumers end up paying more for the same or a lesser good or service so the corporation or small business can comply with the regulation.
  • While these regulations go into effect 30 or 60 days after being published in the federal register, plaintiffs across the country rush to get an injunction from a court to prohibit the agency from enforcing the regulation. Sometimes, like in the case of Obama’s Clean Power Plan, plaintiffs lose in court several times over before the Supreme Court grants relief. However, by that time, the plaintiffs have already spent time and money complying with an unlawful rule. 
  • Some major regulations that were very costly for the economy over the past few years include: the Obama Administration’s Clean Power Plan that the Environmental Protection Agency estimated would cost over $8 billion, the Trump and Biden Administration’s eviction moratorium that cost at least $20 billion, and the Occupational Health and Safety Administration’s employer vaccine mandate that cost at minimum $3 billion in a six month period. 
  • If the rule is unlawful, why do plaintiffs have to rush to court and hope a district court agrees with them that the agency did not have the statutory power it claims? Why should corporations and small businesses spend time and money complying with rules that almost everyone agrees are unlawful at the outset?

The Solution

  • The REVIEW Act postpones the effective date of all high-impact regulations until all cases challenging their legality are complete.
  • High-impact regulations are defined as regulations that the Administrator of the Office of Information and Regulatory Affairs of the Office of Management and Budget (Administrator) “determines may impose an annual cost on the economy of not less than $1,000,000,000.” In other words, if the regulation imposes a cost of more than $1 billion to the economy, it is put on hold until every case challenging its legality is complete.
  •  The Administrator is a position within the Executive Branch, in the Office of Management and Budget that is subject to the Senate’s confirmation process.
  • How does the process work? The agency that promulgated the rule submits it to the Administrator. The Administrator determines whether the rule is a high-impact rule. This determination is published by the agency with the final rule.
  • If no one seeks judicial review of the rule, the rule becomes effective 60 days after it is published in the federal register.

Rep. Jack Bergman’s REVIEW Act is an intelligent and thoughtful response to a growing and out of control administrative state. It is nonsensical and wrong to force corporations and small businesses to comply with regulations that almost everyone agrees are unlawful the moment they are published in the federal register. Thus, Congress should pass the REVIEW Act to prohibit high-impact regulations from taking effect until (if) a court signs off, and to disincentivize federal agencies from promulgating such costly and unjust rules.

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