Regulatory budget can help agencies make better decisions

The Trump administration’s regulatory budget, a crack down on competing regulations and policies deemed unnecessary that take taxpayer money but are not necessarily good for the well being of an agency, will help agencies improve their decision making process, experts said.

William Beach, vice president for policy at George Mason University’s  Mercatus Center said cutting back on duplicative regulations is necessary for agencies and lawmakers to ensure reliability. A regulatory budget does just that, as  it gives the agencies a limit to the total number and value of acceptable regulations.

“We’ve gotten to a point now where there are so many regulations and they’re so costly. We need to make some good decisions,” Beach said on Federal Drive with Tom Temin. “When you put a limit, you have to make decisions between regulations. Without a budget, we may have lots of regulations which we may think are important, but really they are not as important as others. Budgets help you make decisions.”

 

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A Jan. 30 executive order instructed the Office of Management and Budget (OMB) to make significant changes to its decision making process when promoting new regulations, including the new one-in, two-out policy. Starting in the next fiscal year, the agencies will also have to identify the proposed cost of all new and offsetting regulations.

The officials say agencies will identify the regulations they propose for elimination and OMB will have the final say. Agencies must also publish all planned regulatory actions in its Unified Regulatory Agenda, unless they receive a waiver.

OMB will issue implementation guidance to address everything from processes for standardizing the measurement and estimation of regulatory costs to standards for determining what qualifies as new and offsetting regulations to standards for determining the costs of existing regulations that are considered for elimination.

“In my experience in government, once you put a budget in place or any kind of cap or limit, the agencies and bureaus find that there are ways they can improve their service to the public by making choices between competing regulations or goals,” Beach said.

Beach said this would be much easier if the Congressional Budget Office (CBO) and OMB had a separate sub-agency to keep track of what agencies and the administration are doing in terms of making decisions.

“We are first talking about costly duplicative regulations and then we are talking about regulations that cost businesses and the government something and are not as important as others,” Beach said. “[The proposed agency] would be a key player in the whole, one-in and two-out budget executive order, but it won’t be the judge and jury.”

OMB will continue to hold that role, as was established by the executive order. But, the goal of limiting the number of regulations and costs could continue to be a challenge if Congress does not jump on board, Beach said.

“I’m hoping Congress will adopt some kind of facility on its side to give oversight to the executive order. Part of what we are thinking about now in regulatory budgeting is perhaps establishing that office,” Beach said. “[Too many regulations] hurt the economy. This is a way of limiting that damage to the economy.”

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