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benefit test. But this was a case in which EPA did the only cost benefit analyses. EPA's analyses showed that the recycling requirements would either pay for themselves or save money. Further EPA said, we admit that in some places and at some times, the recycling market could be weak. You might have a problem with newspaper, for example. So EPA said we will put in waiver. Any community, any incinerator which shows that the recycling market will not cover the costs of the separation program can get a waiver and keep burning the full 100 percent of the garbage.

The net result of this was an EPA rule that could not cost money because in any instance where it did, the separation requirement was to be turned off. The separation requirement was turned on only where it was neutral or saved money.

In short, the rule simply could not fail a cost benefit test. Yet the White House agencies said, no, and they gave as the rationale the claim that the rule did not meet the cost benefit test.

So my first point is that the process is fundamentally dishonest. It does not do what it purports to do, and that is why I think it should be barred, except in the sense that OMB or any other agency should be able to bring its views in on the record in the comment period like anyone else.

My second point is that if you do not bar undocumented meetings and telephone contacts, then they become the way that the reviewers avoid requirements for written material. If you say that they must put all written material in the docket, then they just will create not written material. If you say they cannot have meetings, then they will have phone calls. And in the end, if you say it must be the Administrator of the EPA who makes the decision, then they will make the decision and they will force the Administrator to say he did. So the process is very difficult to regulate. The first things that would help would be clear time limits, and requirements that all these communications to be docketed contemporaneously so people can see the skullduggery when it is being done. Then we will have a chance to let sunshine regulate the proc

ess.

Chairman GLENN. Let me be devil's advocate a minute, and take up the time limits just a second because I think if you say there should be time limits, they should be set, everything should be done and decided within a certain time limitation so it cannot drag on, that would have to have as a preface to it that all issues are of the same technical difficulty, and could automatically be squeezed into the same time frame for reference. I would think that would be very difficult to do.

Mr. DONIGER. Two points. In prior cases, we have suggested that there be an initial time period which is short and one single extension. So you might have a 30-day period extendable for cause to 90 days. Second, if the OMB staff have a real interest in knowing what the facts are, they could come in at any point before the final rule is sent to them and do their learning. Why should they wait till the tail end after all the work has been done, after the industry and the environmentalists in this instance have hashed it out with the agency doing its best, and then insist that they start from scratch?

Chairman GLENN. In some respects, that is what we did with the 1986 agreement we had worked out with OMB. The agencies were to make their decision, and send them up to OMB for review. We thought this worked fine except over a number of years, certain interests and groups became suspicious that OMB was gradually tilting towards greater representation of the business and the private interest viewpoint on agency rules. Now I did not come to argue that point or not argue it this morning, but our question has been OK, OMB, that is the charge-why are you reversing so many agency decisions, particularly when the real scientific expertise lies in the agencies?

And OMB cannot be expected to duplicate all the different agency expertise, and yet they were overriding many of the agency personnel. Well, what I had hoped for was basically that instead of everything going to OMB and being considered, because OMB or the Council couldn't possibly have people with that kind of technical expertise, but that where OMB had something brought to its attention that it thinks is particularly wrong-maybe some scientist does go off here and demand extremes with a rule or regulation that goes way beyond what would be in the overall best interest. OMB should still have the right to weigh in on cases like that, document them, compile a public record with all parties heard, and then make a review decision finally, and then the agency rulemaking would basically stand as it was made unless they wanted to come in and pick some out that were particularly egregious and take action on those.

So it would not mean that everything was shoveled uphill and in just a mass of things, lots of mistakes would be made. Usually the rule writers and the regulation writers are pretty good. They try and carry out the intent of Congress and reflect it pretty well. Occasionally somebody goes off and does a lousy job, and they should be called to task for that, and OMB is the logical place to do that. And they would have the right, under what we worked out, to come back in and pick out those cases and take action on them. And this was hassled out over a long, long period of time. So we tried to put fairness in the whole thing that way, and make it so that we were not duplicating a lot of other functions of government. That was just sort of a thumbnail sketch of the agreement we had worked out with them, and I thought it was going to be very workable and still give us control-not control, but give us oversight because we could better monitor what was going on in those areas which everybody agrees we do have a right to not only a right, but a responsibility to look at.

So that was what we had worked out on this, and I still think the system would work. We had a sign-off by OMB and the Administration on it, and then it all got delayed as I indicated earlier. So, we are going to have to end. I am sorry we do have to, but I have to go. I have another meeting. I appreciate your being here this morning. It has been very interesting. I do not know whether we will have an administration response to this immediately or not. I hope we do because obviously this should let them know that we have some very serious concerns about this and we are not going to let it die.

Thank you very much.

The hearing will stand in recess subject to call of the Chair.
Dr. MIRER. Thank you, Senator.

[Whereupon, at 11:50 a.m. the Committee adjourned, subject to the call of the Chair.]

SECRECY OR SUNSHINE? PRESIDENTIAL

REGULATORY REVIEW

FRIDAY, NOVEMBER 15, 1991

U.S. SENATE,

COMMITTEE ON GOVERNMENTAL AFFAIRS,

Washington, DC.

The Committee met, pursuant to notice, at 10:00 a.m., in room SD-342, Dirksen Senate Office Building, Hon. John Glenn, Chairman of the Committee, presiding.

Present: Senators Glenn, Levin, Kohl, and Lieberman.

OPENING STATEMENT OF SENATOR GLENN

Chairman GLENN. Good morning. The Senate Committee on Governmental Affairs meets today to hear testimony from the administration and others on legislation to increase the public accountability of the regulatory review process. In particular, we will examine the roles performed by the Council on Competitiveness and OMB. Oversight of the regulatory review process by this Committee has shown the important need for this legislation. Over the past decade we have seen how regulatory review has been used with little justification to weaken laws protecting public health, worker safety and the environment.

The people of this Nation still have no official public record they can turn to that tells how, why and where Presidential regulatory review has affected the implementation of our laws and their lives. It is a process cloaked by mystery and secrecy, and it encourages the representation of interests that may unfairly influence agency rulemaking.

The President has not only the right but the duty to review agency rules. I certainly do not quarrel with that at all. Protecting jobs, strengthening U.S. competitiveness and fostering technological innovation are important policy goals and must be represented in the regulatory process.

But rulemaking is a complex and important process which must also fully take into account the needs and interests of all involved parties.

I have come to believe that we need protections to guarantee that the regulatory process is indeed open and is fair to everyone. Last year, we reached bipartisan agreement with the administration on a set of procedures to govern regulatory review. This agreement would have opened up the process to ensure balance and fairness. Unfortunately, the legislation died in the waning moments of the Senate session, as a series of anonymous Republican "rolling

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