H.R. 998 the SCRUB Act – Ask our Senators to vote No

H.R. 998 the SCRUB Act – Ask our Senators to vote No

A little discussed bill passed the House of Representatives on March 1st, 2017 and thus made its way over to the Senate. This bill, H.R. 998 known as the “Searching for and Cutting Regulations that are Unnecessarily Burdensome Act” or the “SCRUB Act” for short is a wolf in sheep’s clothing and was voted yes on by Duncan Hunter.

I regard this bill as a wolf in sheep’s clothing because at first glance there is a lot in the bill that seems to make sense. In hyper simplicity, the authors of this bill purport that the bill is designed to weed out unnecessary rules & regulations within the federal government, which sounds like one of us weeding out our ‘Important Papers’ file – clearing out what once were vital documents that time, technology, etc… have made irrelevant and unnecessary. But it is upon reading the bill that one begins to realize this bill is not a sheep at all.

So, for a deeper dive into the bill…. The bill’s primary goal is to reduce by a minimum of 15% the cumulative financial impact or costs that regulations/rules have on the United States’ economy (it is a little unclear how exactly this 15% gets measured).

There are two routes to achieving this goal. The first route is via a nine member Commission (the “Retrospective Regulatory Review Commission”). The members of this Commission will all be selected by the President and confirmed by the Senate. Mr. Trump will have sole pick over the chair of the Commission and he will select the other eight members by picking two members from four lists – the four lists being provided by: the Senate majority leader, the Senate minority leader, the Speaker of the House and the House minority leader. So five (and you guessed it all decisions by the Commission would be made via voting and majority wins) out of the nine members would be Republicans. And just to be clear this would be a Commission picked by Mr. Trump and run by Republicans as the Commission expires after 5 ½ years.

The Commission, once up and running, would review the Code of Federal Regulations and identify regulations/rules that they believe should be repealed. The bill spells out which rules should be given priority – for example those that cost the economy $100 million per year or more, rules that are 15 years old or older, that have too much paperwork, unfunded mandates, etc… and also provides a list of criteria that should be used in identifying rules to consider repealing. This list of criteria covers a wide terrain but concludes with, “Such other criteria as the Commission devises to identify rules and sets of rules that can be repealed to eliminate or reduce unnecessarily burdensome costs to the United States economy” making it clear that any rule the Commission deems to be excessively burdensome on business is fair game. And with regards to the business world, while anyone who worked as a lobbyist in the past two years is unable to sit on the Commission, there is no statement within the bill barring commission members from being lobbied.

Additional interesting aspects of the Commission are that it has subpoena power, it can accept input from anyone (literally anyone, the President, industry, you or I) on which rules to review, its meetings & hearings are open to the public though no closed door meetings are banned, it may hire staff, consultants or experts and has a budget of up to $30 million, which does not include commission members’ salaries or per dium allotments.

Once the Commission identifies a regulation/rule that it believes should be ended, it has two options it can make a recommendation to Congress to immediately repeal the regulation/rule or it can recommend that the regulation be repealed via the cut-go procedure. If the first option is taken, then Congress must pass a joint resolution stating, “That Congress approves the recommendations for repeal of the Retrospective Regulatory Review Commission as submitted by the Commission on [date]”, if Congress gets the joint resolution passed then that regulation is off the books, so to speak. Once a rule or regulation is repealed by Congress then that agency must do the repeal within 60 days and cannot create a new rule or regulation, which is in essence the same as the repealed one.

The second option, the cut-go procedure is also the second means by which the bill strives to achieve its stated goal – reducing the fiscal impact of regulation on the US economy by a minimum of 15%. The cut-go procedure is a rule introduced by the bill, which requires any agency that makes a new regulation to repeal as many regulations as are needed (or have been recommended by the Commission) in order to ensure that the annual costs of the new rule are offset by the repealed rules. This ensures that the new regulation/rule would have no fiscal impact on the economy. It should be noted that agencies do not need to wait for the Commission to recommend the repealing of rules, agencies can repeal rules at anytime and build up a credit for future Commission recommended repeals. So either an agency participates in the cut-go procedure or they cease to be a viable part of regulating our society (the exception is that if the Commission has reviewed all the regulations of an agency and simply cannot find any to repeal then the agency can create as many new regulations as desired, until those new ones are reviewed by the Commission of course…).

If you would like to read the bill in detail: https://www.congress.gov/bill/115th-congress/house-bill/998/text?q=%7B%22search%22%3A%5B%22H.R.+998%22%5D%7D&r=1.

Since Congress already has the power to review regulations, it is the cut-go procedure that seems to be the heart of this bill.

The policy branch of Consumer Reports wrote a letter urging Representatives to vote against H.R. 998, a key argument being:  “Cost considerations … should not override and disregard the protective purposes for which a regulation was initially developed. Nevertheless, the SCRUB Act places cost considerations front and center. The bill sets a goal for the commission to reduce cumulative costs by 15%, which could lead to the repeal of essential safety, health, and environmental rules even if the benefits of these protections greatly exceed their costs. Through passage of a joint resolution, Congress could eliminate dozens of critical safeguards placed on a list by the commission, without any thoughtful consideration or debate by legislators about the merits and importance of the specific rules. The bill also would establish a nonsensical regulatory “cut-go” system, under which agencies would not be permitted to issue a rule, even if it is urgently needed to protect the public, without offsetting costs by repealing other, potentially unrelated rules that the commission has recommended for elimination. Combined, these provisions clearly would prioritize companies’ interest in lowering their costs over the interest of consumers and the public in sensible protections” https://consumersunion.org/research/cu-letter-to-the-u-s-house-opposing-h-r-998-the-scrub-act-h-r-1004-the-regulatory-integrity-act-and-h-r-1009-the-oira-act/.

The Center for Responsible Lending also wrote an open letter stating, “H.R. 998 would establish a new bureaucracy empowered to dismantle long-established science-based public health and safety standards and would make it significantly more difficult for Congress and federal agencies to implement essential future protections. Along with previous bills that have passed the House and the President’s Executive Orders instituting a regulatory freeze and requiring the removal of two rules for every one that is finalized, this legislation demonstrates a concerted attack on the process that Congresses have instituted to protect Americans from those risks that they cannot protect themselves”http://www.responsiblelending.org/sites/default/files/nodes/files/research-publication/crl_css_hr998_scrub_feb2017.pdf

And for voices one does not often hear from, interesting critiques of the bill were also offered by Virgin Islands Congresswoman Stacey Plaskett (who knew the Virgin Islands had a Congresswoman) http://viconsortium.com/virgin-islands-2/in-fight-against-republican-efforts-to-undermine-federal-regulations-plaskett-offers-amendment-to-defund-scrub-act/ and Jamie Raskin (the first openly non-religious, atheist, humanist member of Congress) https://www.bna.com/house-passes-bill-n57982084677/.