Thank you for your April 23, 1991 response to our letter regarding the President's Council on Competitiveness, the reauthorization of the Paperwork Reduction Act, and the Council's role in regulatory affairs. We share with you a commitment to improve our nation's competitiveness, preserve the integrity of the rulemaking process, and reauthorize the Paperwork Reduction Act. We look forward to working with you in reaching each of these important goals during the 102nd Congress.

Subsequent to your letter, we received a April 25, 1991 letter from Allan Hubbard, your Deputy Chief of Staff and Executive Director to the Council on Competitiveness. Mr. Hubbard's letter and attached documents are helpful in understanding the work of the Council. They do not, however, answer the questions in our letter of April 17, 1991.

We would appreciate answers to those specific questions by May 20, 1991. If you have any questions or need any additional information about this request, please have your staff contact Leonard Weiss, Governmental Affairs Committee Staff Director, at 224-4751.

The Vice President has asked me to respond to your letters requesting additional information about the Council on Competitiveness. As you know, the Vice President has met with you and Senator Levin to discuss the Council and its mission. Additionally, our staff has met with committee staff to discuss the Council's operations.

Let me make two basic points about the Council and its mission:

First, in implementing one of the Council's primary assignments from President Bush--to reduce the regulatory burden on our economy--the Vice President seeks to promote the general interest of all Americans. We are committed to reducing and-wherever possible--eliminating excessive, burdensome and unnecessary regulations that:

Threaten the loss of American jobs,

Raise the cost of products to American consumers,

Impose needless government paperwork on America's small
business women and men, and

Impose unnecessary federal mandates on our cities, counties
and towns.

Second, I understand that there is some concern that the Council is a "secret, backdoor channel" for deciding regulatory issues. Let me assure you that this is definitely not the case. Citizens from around the country are invited to bring regulatory problems to the Council's attention. Whenever there is a policy issue, our staff welcomes representatives of all sides of the debate to come in and present their arguments. In so doing, we always encourage them to present their arguments to the regulatory agency responsible for issuing the regulation.

The agency is responsible for compiling a record available to the public of the pertinent factual information on which the agency relies to support its rulemaking decisions. The Council on Competitiveness uses this record, together with the analyses of the regulation prepared by professionals at the regulatory agency, OMB, and other government agencies, in its deliberations regarding policy issues. As the attached Fact Sheets and Press Releases demonstrate, the Council publicly announces its regulatory initiatives.

We look forward to working with you to reduce the regulatory burden on all Americans. Attached is a copy of my April 25th response to your first letter that includes the basic information about the Council. In addition, the following information addresses the specific questions you raised in your first letter.

1. What specific role does the Council play in reviewing agency regulatory activities? Through what specific legal

authority and through which executive orders or directives does the Council perform those functions?

Executive Order Nos. 12291 and 12498 set forth the specific procedures for the regulatory review process. On June 15, 1990, President Bush directed the Council on Competitiveness to exercise the same authority over regulatory issues as did the Presidential Task Force on Regulatory Relief under Executive Order 12291. The President also designated the Council on Competitiveness, chaired by Vice President Quayle, as the appropriate council to review issues raised in conjunction with the regulatory program under Executive Order 12498.

2.

What is the relationship of the Council to OMB's Office of Information and Regulatory Affairs (OIRA) and to the Office of the OMB Deputy Director for Management (established by the Chief Financial officers Act of 1990)?

Executive Orders 12291 and 12498 vest responsibility for their implementation in the Director of the Office of Management and Budget, subject now to the review of the Council on Competitiveness. The Office of Information and Regulatory Affairs (OIRA) reviews regulations under these Executive Orders. OIRA staff keeps the Council staff informed about the regulatory review process and the status of particular issues under review. The Chief Financial Officers Act of 1990 provides that OMB's Deputy Director for Management is to, inter alia, "perform all functions of the Director, including

all functions delegated by the President to the Director. [relating to] regulatory affairs." (Sec. 503 (b) (2))

3.

Please describe the council's regulatory review activities.
How are regulatory activities referred to or selected by the
Council for review? What procedures are followed and what
standards are used to review those regulatory activities?
How are Council decisions or comments communicated to
agencies?

The Council's regulatory review activities involve working closely with the OMB in carrying out OMB's regulatory review under E.O. 12291 and its development of the Regulatory Program under E.0. 12498. The Council determines which items it will review based on the views of its members and staff; normally the items it takes up are those that present difficult issues under E.O. 12291 that require Cabinet-level attention, particularly issues where there is a policy disagreement among agencies.

The process for reviewing regulations is spelled out in Executive Order Nos. 12291 and 12498 which provide inter alia:

"the Director [of OMB], subject to the direction of the Task Force, shall have authority, .to prescribe criteria for making [determinations whether a rule an agency intends to propose or to issue is a major rule]." (E.O. 12291 Section 3 (b))

"The Director [of OMB), subject to the direction of the
Task Force, which shall resolve any issues raised under
this Order or ensure that they are presented to the
President, is authorized to review any preliminary or
final Regulatory Impact Analysis, notice of proposed
rulemaking, or final rule based on the requirements of
this Order." (E.O. 12291 Section 3 (e) (1))

"'Regulation' or 'rule' means an agency statement of general
applicability and future effect designed to implement,
interpret, or prescribe law or policy or describing the
procedure or practice of an agency... [with certain
exceptions for formal rulemaking, national security, agency
organization, management or personnel]" (E.O. 12291
Section 1(a))

"The Director [of OMB), subject to the direction of the
Task Force, may designate currently effective rules for
review in accordance with this order, and establish
schedules for reviews and Analyses under this Order."
(E.O. 12291 Section (3) (i))

"The Director, subject to the direction of the Task Force, may, to the extent permitted by law: (1) Require agencies to provide additional information in an agenda [published every 6 months of proposed regulations that the agency has

issued or expects to issue, and currently effective rules that are under agency review]; and (2) Require publication of the agenda in any form." (E.O. 12291 Section 5(b))

"To the extent permitted by law. . .the Director shall have authority, subject to the direction of the Task Force, to:

(1)

(2)

(3)

(4)

(5)

(6)

(7)

(8)

Designate any proposed or existing rule as a major rule in accordance with Section 1(b) of this Order;

Prepare and promulgate uniform standards for the identification of major rules and the development of Regulatory Impact Analyses;

Require an agency to obtain and evaluate, in connection with a regulation, any additional relevant data from any appropriate source;

Waive the requirements of Sections 3,4, or 7 of this Order with respect to any proposed or existing major rule;

Identify duplicative, overlapping and conflicting
rules, existing or proposed, and existing or proposed
rules that are inconsistent with the policies
underlying statutes governing agencies other than the
issuing agency or with the purposes of this Order, and,
in each such case, require appropriate interagency
consultation to minimize or eliminate such duplication
overlap, or conflict;

Develop procedures for estimating the annual benefits and costs of agency regulations, on both an aggregate and economic or industrial sector basis, for purposes of compiling a regulatory budget;

In consultation with interested agencies, prepare for consideration by the President recommendations for changes in the agencies' statutes; and

Monitor agency compliance with the requirements of this Order and advise the President with respect to such compliance." (E.O. 12291, Section 6 (a))

"The Director, subject to the direction of the Task Force, is authorized to establish procedures for the performance of all functions vested in the Director by this Order." (E.O. 12291 Section 6 (b))

"In the event of disagreement over the content of the agency's draft regulatory program, the agency head or the