Bi-Partisan Senate Legislation Aims to Provide Regulatory Relief
A bill introduced in the Senate last month would require independent agencies, such as the CFPB and NCUA, to analyze the costs and benefits of new regulations and tailor new rules to minimize unnecessary burdens on the economy, a move that could ease the rate at which new regulations are introduced.
September 11, 2012
A bill introduced in the Senate last month seeks to provide regulatory relief to institutions across a number of sectors by requiring the regulating agencies to conduct a cost-benefit analysis before introducing new regulations.
Introduced by Sens. Mark Warner (D-VA), Rob Portman (R-OH) and Susan Collins (R-ME), the Independent Agency Regulatory Analysis Act would require independent agencies, such as the Consumer Financial Protection Bureau (CFPB) and National Credit Union Administration (NCUA), to analyze the costs and benefits of new regulations and tailor new rules to minimize unnecessary burdens on the economy—a move that could ease the rate at which new regulations are introduced.
The Credit Union Times reported yesterday that the bill could be addressed as part of a Senate Committee on Homeland Security and Governmental Affairs meeting on Sept. 20, and a press release from Warner’s office said the bill adopts a key recommendation of the President’s Jobs Council.
“It is important to strike the right balance between protecting vital public safeguards and imposing costly regulations,” Warner said. “However, we all agree that basic cost-benefit principles should apply to all regulators. This bi-partisan legislation will help to ensure that all agencies only advance major regulations with a firm understanding about their impact on the economy.”
While federal agencies have been required for the past 30 years to scrutinize the costs and benefits of major new regulations, independent agencies have been exempted from this process. The bill would fill that gap by authorizing the president to bring independent agencies into the same analysis and review process that governs other regulators.
“Independent agencies exercise vast power over major sectors our economy—from telecom, to agriculture, to financial services—but they are exempt from common-sense requirements including cost-benefit analysis of major regulations to ensure they do more good than harm,” Portman said. “This bill would close the loophole for independent agencies by authorizing the president to bring them within the same regulatory review framework that applies to other agencies. This is a bipartisan, consensus reform with broad support, and it will promote a more stable regulatory environment for economic growth and job creation”
According to government records, only one of the 58 major final rules issued by independent agencies since 2008 was based on a complete cost-benefit analysis, the press release said. Based on Government Accountability Office data, the release estimated that nearly 200 major regulations issued by independent agencies between 1996 and 2011 were exempt from the cost-benefit framework that applies to other agencies.
“No business owner I know questions the legitimate role of limited government in protecting our health and safety. Too often, however, our small businesses are buried under a mountain of paperwork that drives up costs, prevents the hiring of workers, and impedes economic growth,” Collins said. “Business owners are reluctant to create jobs today when they’re going to need to pay more tomorrow to comply with onerous new regulations. I have asked employers in my state what it would take to help them add jobs. No matter their business or the size of their work force, they tell me that Washington must stop imposing crushing new regulations. Right now, independent agencies are not required to examine the costs and benefits of their regulations before they adopt them. This common sense bill would change that.”
Questions? Contact Director of Regulatory Advocacy John Trull: 503.350.2209, firstname.lastname@example.org.