Sunset Proposals: Can They Reform the Bureaucracy?

Report Government Regulation

Sunset Proposals: Can They Reform the Bureaucracy?

October 7, 1977 28 min read Download Report
Thomas R.
Senior Visiting Fellow

(Archived document, may contain errors)

38 October 7, 1977 SUNSET PROPOSALS CAN THEY REFORM THE BUREAUCRACY I s EXECUTIVE SUMMARY Politicians are well aware of the rising.citizen impatience with the almost exponential growth in the size and cost of the federal government. As Senator William Roth has stated, "One clear mandate from the 1976 election is to streamline the federal bureaucracy and reform poor planning, excessive paperwork, admi nistrative overlap, and program duplication in government." The reasons for this mandate are obvious. Consider There are 228 health programs, 156 income-security and and social-service programs, and 83:housing:-'pfograms scattered among several of the executive departments In. the last twelve years, the number of federal spend ing programs increased from 50 to nearly 1,000. The federal budget climbed from $158.2 billion fn 1967 to 413 billion in fiscal year 1977 1 The federal debt currently exceeds $633 billion, and the yearly interest payment is almost $40'bPllion Combined state and federal taxes says a report by the Joint Economic Committee of Congress, are rising twice as fast as the costs of food, housing, and transporta tion. The average taxpayer today must work four'months to pay his tax bill A January Gallup poll found that 39. percent of the American. people believe that big government is the biggest threat to the country in'-the future NOTE Nothing written here is to be construed as necessarily reflecting the vdews 04 Hcriitag.e Founda-ti.on _A or. as an :at-te-mpc <_o2c_-.aid>

In the last three years, Congress, in response to public outrage about federal spending, has sought ways to reverse the profligate spending which has become almost institutionalized since the administration of Franklin Roosevelt. The Congres sional Budget and Impoundment Control Act, passed in 1974, is a major reform which forces Congress to establish spending and revenue targets and budgetary priorities in its annual considera tion of the. federal budget. It also requires both Houses to vote annually on the level of the federal debt, which had pre viously been treated as a leftover result of the budgetary pro cess. Passage of the budget act was a first step towards dis ciplining the larger categories of the budget. In the last two years, committees of both Houses, but primarily of the Senate have discussed legislation designed to extend the same discipline to the multitude of individual federal programs and the regula tory agencies.

Two much-discussed legislative ideas, zero-based budgeting and sunset review, have been the subject of over fifty bills in troduced in the Congress during the last two years. Under the sunset idea, government agencies and programs would be forced to justify their own existence at the end of their authorization period or face automatic termination. Senator Edmund Muskie backedby--abipartisan Senate group of supporters, included both sunset review and zero-based review in S2925, which he intro duced in the last session of the 94th Congress. Critics con tended that this was too big a pill for the federal bureaucracy to swallow at once, and the bill died in committee. Undeterred Muskie has introduced a new sunset bill, S2, with more flexi ble review guidelines for the committees:to follow,into the 95th Congress I Muskie's bill would take on the entire federal spending process at once. Eight other proposed bills have the regulatory agencies as their target. In recent years, the mass of federal regulation has provoked more rancorous argument between Congress business, consumers, and federal bureaucrats than any other-part 6.f 'the. gove-rnment and the major regulatory reform bills now pending in the Senate.

All of them had wide bipartisan support when introduced, but en thusiasm for the bills has waned as many questions have arisen over their merits.

This paper provides detailed analyses of the sunset act, S2 The 'Sunset Act of '1977 S2. Critics have contended that the time and work involved in reviewing one-third of federal spending programs every two years would be an impossible burden for congressional committees. There is no agreement about what federal programs should be exempt from sunset. Such long established federal programs as the Tennessee Valley Authority,the Center for Disease Control, and most veteran's benefits would be subject to the reeiew and termination process as the bill is now written.

The Regulatory Reform Act S600. A tough bill which would re quire periodic executive department attempts to reduce the number and scope of federal regulations. The executive department would be required to regularly assess the effects of regulation on specific categories of business.

The Interim Regulatory Act, S263. This bill would require seven independent regulatory commissions to make recommendations to Congress for the simplication and recodification of all statutes by authority of which they carry out their activities. It would not effect any reduction in the amount of regulation.

The Interim Regulatory Acts, S1532-1537. These bills con cern the same seven regulatory commissions and also would not reduce the level of federal regulatory activitp. Their purpose is to force the commissions to recodify, update, and streamline the regulations they have issued. The commissions would be pro vided new muscle to enforCeltheir regulations under a clause which grants them extensive powers of litigation. In addition the bill would provide, both to business and consumer advocates easier and quicker access to the ruling boards of the commissions.


--There are 228 health programs, 156 income-security and social-service programs, 83 housing 'programs.scattered among several of the executive departments.

--A General Accounting Office study found eight health clinics which receive federal funds operating in one neighbor hood under different programs with none of them having any know ledge of what the others were doing.

--The GAO has found agencies unable to say how much they were spending on administrative costs as compared with actual services.

--In the last twelve years, the number of federal spending programs increased from 50 to nearly !1,.000 climbed from $158.2 billion in 1967 to an estimated $413 billion for fiscal year 1977.

--The federal debt currently exceeds $633 billion, and the  yearly interest payment is almost $40 billion. 

--Combined state and federal taxes, says a report by the Joint Economic Committee of Congress, are rising twice as fast as the costs of food, housing and transportation. The average taxpayer today must work four full months just to pay his tax bill.

--There are now forty-four independent agencies, twelve cabinet departments and 1,240 other units of the federal government.

--A January Gallup poll found that 39 percent of the Ameri can people believe that-big government is "the biggest threat to the country in the future (Emphasis added.)

--A 1976 Harris survey found that 76 percent of the people think that "the trouble with government is that the elected of ficials have lost control over the bureaucrats, who really run things."


Worry about the growth of the federal bureaucracy is not new. Former Supreme Court Justice William O. Douglas, as chair man of the Securities and Exchange Commission, proposed to President Franklin Roosevelt that every federal agency should be abolished within ten years of creation. Since World War 11 two independent federally funded citizens commissions, commonly known as the Hoover Commissions, have conducted thorough reviews of the organization and effectiveness'of the federal government. c 2 The recommendations of the first Hoover Commission (1947-1949 led to the Reorganization Act of 1949, which gave the President the authority to reorganize the executive branch and create new executive agencies subject to the veto of either House of Congress. The creation of the Office of Management and Budget the Domestic Council, and the Environmental Protection Agency in 1970 are examples of federal reorganization that took place under this act. Before the President's reorganization authority under this act terminated in 1973, seventy-one reorganizations went into effect while nineteen were vetoed. President Johnson proposed seventeen reorganization plans and President Nixon six all went into effect. It should be noted that most presidential actions under the Reorganization Act sought a greater efficiency in the federal bureaucracy, but did not have the effect of re ducing its size. In 1971, President Nixon proposed that the twelve cabinet departments be reduced to eight. The plan was widely praised by political scientists and various other ob servers of government, but was never given serious consideration in congress.


Conqress' "oversight" authority, bv which it assigns itself the task of periodically evaluating the efficiency, purpose and cost-effectiveness of federal agencies and programs, is well established in law. The most important congressional bills and resolutions concerning oversight are: the Intergovernmental Cooperation Act of 1968 which requires congressional committee to reevaluate at least every four years grant-in-aid programs that do not have expiration dates I the Legislative Reorganization Act of 1970 which ordered the Comptroller General to "review and analyze the results of government programs and activities carried on under existing law."

The same act also directed that GAO personnel should be available to congressional committees to assist in evaluations.

In 1973 the Office of Management and Budget established a Division of Evaluation and Program Implementation to assist federal agencies in improving their own evaluation work. The House Committee Reform Amendments of 1974 stated that the House legislative committees must establish special oversight sub committees. It also required existing subcommittees to carry out substantial'oversight in their legislative areas. The same group of amendments also directed the House Committee an Government Operations to assist the oversight committees in their activities.

Obviously Congress is becoming increasingly concerned about evaluating the programs that receive federal funds. According to the Congressional Research Service of the Library of Congress, -3 L federal expenditures for program evaluation rose 650 per- I cent from 1969 to 1974 from $20 million to more thanl$130 million Still, many members of Congress, and a growing per cent of the public, think that the oversight procedures already established are inadequate and often ignored THE FEDERAL BUDGET Review of the budget as opposed to review of the programs for which funds are budgeted has been brought under increasing scrutiny in recent years The replacement of the old Bureau of the Budget with the Office of Management and Budget in 1970 was an executive plan to get more centralized control over the budget process. In 1973 OMB inaugurated a managemen.t by budget system a procedure designed to force the managers of the bureaucracy to direct their programs according to stated objectives.

The most significant budgetary legislation of recent years This was the Congressional Budget and Impoundment Control Act of 1974 which, forhe first time, established a yearly procedure tor Congress to specify the total size of the federal budget sweeping budget reform act 1) forces the two houses to agree on spending and revenue targets and budgetary priorities 2) authorizes the legislative committees of Congress to undertake evaluations of federal programs and agencies or the laws by which money is granted to these federal programs, or to order federal agencies to undertake these evaluations them selves and then report to the committees 3 created a new GAO office for the purpose of ,recommendix methods of evaluation to Congress 4) requires the Treasury Department and OMB to provide in formation on federal programs and spending to congressional com mittees, the GAO and the Congressional Budget Office on request 5) provides for increased congressional control over execu tive spending decisions through the impoundment provision of the Act ACTIONS BY THE STATES State governments have been more vigorous in reorganizing and streamlining their bureaucracies. the last ten years twenty states have completely overhauled their executive branches.

In 1971 Governor Jimmy Carter introduced zero-based budgeting into the government of Georgia. Modified versions of zero-based 4- budgeting are used in four additional states. In 1976 Colorado became the first state to pass a comprehensive sunset law. Un der the Colorado plan, the state's regulatory agencies, repre senting about a third of the executive bureaucracy, face termina tion or "sunset" every six years unless they justify the purpose and costs of their existence. A third of the state's thirty-nine agencies subject to the sunset law are reviewed in publiTI hearings every' two years. Of the thirteen agencies reviewed in the 1977 session of the legislature, four were abolished, two were merged and another one was moved to dif ferent department.

Twenty-two other states have enacted versionsof the sunset idea.

The first round of review is scheduled to go into effect within the next two years for all these states. In addition, Alabama has enacted a "high noon" law whereby state agencies are auto matically reviewed but not terminated: they can be terminated only by a special act of the legislature FEDERAL SUNSET LEGISLATION Sunset legislation was introduced by members of both houses of Congress in 19

76. In the House, the proposal, despite the bipartisan support of 112 co-sponsors, never got beyond hearings held separately by the Budget Committee and the Rules Committee.

The Senate bill, S2925, co-sponsored by fifty-five senators, was referred to three different committees. Senator Edmund Muskie the power behind the budget. reform act of 1974, introduced the Budget Committee, saw the sunset bill as a necessary adjunct to budgetary reform The Senate Government Affairs Committee unanimously reported S2925 on August 6, 19

76. There were six significant provisions of the bill 1. Budgeted programs and activities, grouped by function would be assigned to legislative committees for review that is all federal programs of similar purpose would be reviewed at the same time. During the first cycle of review, all programs of similar purpose, regardless of their original authorization period, would have to be reauthorized. After the first cycle these programs would then come up for reauthorization together every five years 2. Each category of budgeted programs and activities would have to be reviewed and reauthorized every five years. If a pro gram was not.reauthorized, the money for its activities would be taken away to the funding of specific agencies or programs. Thus, agencies and programs terminated under sunset would still exist on paper 3. The bill did not apply to any authorizing law, but only 5 with complete legal authority but would have no funds to operate.

Obviously, funds could be reappropriated at any time 4. Reauthorizations would be limited to five years or less 5. Exempted from the sunset process were interest payments on the national debt, other interest payments, and programs funded by individual contributions such as Social Security and Medicare 6 be carried out over an 18-month period prior to the sunset date.

The legislative committees of Congress would be required to con duct extensive zero-based reviews of all programs within their jurisdiction every five years. In addition, the President, be fore submitting his budget message to Congress, would be required to conduct zero-based review of all executive branch programs and activities scheduled for termination in the upcoming year. Bills authorizing funds for less than five years would not be subject to zero-base review The process of sunset review was quite detailed and would The Senate Rules and Administration Committee reported sun set without recommendation but also "without prejudice." The criticisms of the committee stemmed from its perspective of having jurisdiction over all legislation concerning rules and procedures for the conduct of daily business of the Senate. Although four Rules Committee members were co-sponsors of S2925, the committee as a whole warned that "this far-reaching proposal would con siderably alter as well as increase existing congressional pro cedure." The committee considered it unrealistic that so few programs were exempted from the sunset review process, and ac cordingly, recommended that programs such as the Tennessee Valley Authority and the Center for Disease Control, be excluded. The committee further warned that there was no exact estimate of the number of programs to be reviewed, that many programs lacked def inite objectives and, therefore, were not easily subject to evaluation, that the- five-year reauthorization period and the 18-month review period were too inflexible, and that the review and reauthorization schedule would disrupt the orderly functioning of many programs now on three to five-year authorization plans.

In addition, the committee pointed out that 92.2 percent of the 1050 budget accounts represented only 10 percent of total outlays in fiscal year 19

77. The houses of Congress would be forced to conduct lengthy reviews of these programs on an equal basis as the programs that account for 90 percent of the federal budget.

Finally, the committee recommended a phase-out period of one year for any program terminated to soften the blow to both agency personnel and to the general economy.

The Senate Finance Committee, while not reporting the bill raised similar questions in a staff analysis. The analysis con tended that legislative experience has shown that permanent -6 authorization is the most useful and eff,cient means of budgeting for certain programs. The analysis argued that permanent authori zations were an indispensable diplomatic tool in negotiating in ternational agreements and establishing economic incentives. The analysis also claimed that congressional oversight would in fact decrease because committees would be put in the position of con ducting reviews as advocates rather than critics since their ability to obtain reenactment may depend on how convincing a case for reenactment they can make through those studies sunset legislation to the floor combined with the misgivings raised by the Senate Rules and Finance committees, sunset legis second session of the 94th Congress. Undeterred, Senator. Muskle with the major criticisms of the bill in mind, revised-the bill and reintroduced it as S2 in the new 95th Congress. Hearings were held in March; the bill was.further revised in committee and then reported to the Senate. Again, the Rules and Finance Committees have delayed action on the bill, which almost certainly will not get to the Senate floor during the first session of the current Congress. Muskie is hoping to get the bill reported out of the Rules and Finance committees by'the spring of 1978 in the hope that the Senate would begin debate by the.beginning of sum mer With the little impetus that House committees gave to pushing lation died in the normal legislative logjam at the end of the ANALYSIS OF S2 S2 as amended defines sunset review as "consideration by the committees of the Senate and House of Representatives which have legislative jurisdiction over the program, as to whether the merits of the program justify its continuation .rather than termination its alteration, or its continuation at levels less than, equal to or greater than the existing level The preamble of the bill fur ther states that, for purposes of grouping federal agencies and programs, the functional and subfunctional categories will be those set forth by OMB in the budget of the United States. Also, off budget programs that is, those programs that are federally funded but whose outl-do not appear in the outlays of the total bud get 1977 outlays of these programs 11.1 billion are to be brought under the sunset review and included in the functional cateqories TITLE I Title I establishes a six-year schedule for the review and reauthorization of the budqets of federal proqrams, accordinq to qroupinqs by budget subfunction. Sunset review would be con ducted on a third of the federal budget every two years, with the first review date scheduled for September 30, 19

82. The -7 next review date in the first cycle of the six-year review procedure would be September 30, 1984, and the last would oc cur on September 30, 1986.

In addition, under its major provisions, Title 1: requires that the funding for all programs, including those which are now permanently funded, be specifically re authorized every six years according to the schedule or be terminated; states that programs can be authorized or reauthorized for less than six years but no program's authorization can ex tend beyond the sunset review date for that program's budgetary subf unction; exempts interest on the public debt and other government interest obligations, all trust funds, general and federal em- ployee retirement and disability insurance, the enforcement of civil rights, the federal judiciary, and funding authorized in one year but available for expenditures in subsequent years (such as construction and procurement contracts) from the jurisdiction of the bill: restricts Congress from reauthorizing any program without having considered a report which assesses "to the extent practi cable in quantitative and qualitative terms" the objectives and achievements of the program, describes similar programs that unnecessarily duplicate the work of the program in question, and in cludes any other analyses which the relevant congfessional-com mittees want to include; and provides that if the budgetary authorization for a program is terminated, the substantive laws and statutes which enacted the program will not automatically be terminated at the same time ANALYSIS OF TITLE I For fiscal year 1977, 77 percent of the budget of the United States was "uncontrollable," that is, permanently authorized which only major changes in substantive law could either increase or decrease. Trust funds financed by individual contributions such as Social Security and Medicare, have always constituted the major part of the yearly uncontrollable percentage of the federal budget. For fiscal year 1977, Congress considered only the 23 percent of the federal budget that was- subject to reauthor ization.

By way of example, the HEW-Labor reappropriations bill for fiscal year 1978, which was delayed because of the House-Senate argument over public funding of abortion, is 60.1 billion. But 8 the spending by those two departments for fiscal year 1978, in cluding this controllable $60.1 billion, will actually be about 19 0 billion If enacted, S2 would reduce the uncontrollable outlays of the federal budget from 77 percent to roughly 54 percent. Many long-established federal programs, such as the Tennessee Valley Authority, the Center for Disease Control, many of the programs which the Veterans' Administration controls, now permanently funded or annually renewed with little congressional criticism or debate, would go out of business unless Congress reviewed their achievements and specifically reauthorized them Government spending programs are already grouped according to their budgetary subfunction, that is, their purpose. But the many programs under any one subfunction are now reauthorized in dividually and in different years. Sunset would bring about a major reform by collecting all programs of each subfunction and mandating their reauthorization on the same date. Every two years Congress would be forced to think and to vote in terms of the larger purposes of federal spending rather than in terms of individual programs.

Under Title I, every program, before it can be reauthorized must be reviewed by the appropriate congressional committee or committees with the conclusions of this review reported to both houses. How reviews of programs would be carried out is a major question mark of the whole sunset idea. Critics contend that congressional committees would be burdened with an impossible workload. On the one hand, Title I gives the criteria (as out lined above) which each sunset review must."include, but is not limited to." On the other hand, this same title gives each com mittee the discretion to conduct reviews "in the scope and de tail the committee or committees having jurisdiction deem appro priate To allow Congress to respond to unforeseen emergencies, Title I permits new appropriations for which no money had been voted in the preceding fiscal year as long as the relevant committee ex plains the nature of the emergency. An example of this type of emergency is the authorization of relief money for the bursting of the Grand Teton Dam. Title I would also allow a one-year ex tension for ongoing programs that the Congress has not yet re authorized by the sunset review date if an authorization has passed either the House or Senate or been reported by a committee of either House. Finally, either House may change the review date applicable to any program, subject to some procedural limi tations.

Senator Muskie had included a Provision which would have brought the government program of tax expenditures under the sun set review process. Tax expenditures are those tax credits 9 deferrals and low tax rates which the government allows in or der to encourage certain economic activities, such as investment exporting, support of charitable institutions and others. If the government did not allow tax expenditures, federal revenues would increase an estimated $101 b.illion annually. The Governmental Affairs Committee voted to exclude tax expenditures from automatic sunset review because many critics contended that the investment climate would be seriously jeopardized by the uncertainty that tax expenditures could be eliminated. Muskie has vowed to fight on the Senate floor to reinstate tax expenditures under sunset TITLE I1 Under its major provisions, Title 11: directs the Congressional Budget Office to compile, by July 1, 1979, an inventory which would provide a comprehensive detailed portfolio of the legislative, budgetary and achievement record of every federal spending program, and requires all legislative and executive agencies to pro vide the CBO any assistance that the CBO requests in the prepara tion of the program inventory ANALYSIS OF TITLE .I1 When Senator Muskie introduced S2 on the floor of the Senate he asked whether anyone "really knows how many federal programs there are all together." Under Title 11, the Congressional Bud get Office would have to find out. In addition, the CBO would become the permanent scorekeeper of this comprehensive inventory which it must regularly update as Congress acts to reauthorize or terminate TITLE I11 Under its major provisions, Title 111: allows the Senate and House to select a number of specific programs for "comprehensive evaluation" from among those subject to review in,any two-year period, requires the President to include in his annual budget message his recommendations for programs to undergo this compre hensive evaluation, requires the President to submit his own evaluation'of the programs specified by the two Houses as subject to compre hensive evaluation, and specifies guidelines for congressional committees to follow in conducting the comprehensive evaluations 10 ANALYSIS OF TITLE I11 The most controversial section of last year's sunset bill dealt with the requirements and guidelines for the authorizing committees to follow in conducting their reviews of programs scheduled for reauthorization of sunset. Last year's bill S2925, detailed four separate stages for authorizing committees to follow. It included a mandatory zero-based!bud= review of every program. Critics cautioned that putting the entire federal budget on sunset review and zero-based,budget review at the same time was far too ambitious and that the results would be unpre r dictable. It was also claimed that the workload would be ex cessively burdensome.

Title I11 of S2 allows the Congress to select, and the President to recommend, certain specific program areas for com prehensive evaluation from among those subject to review. It is important to realize that each budgetary subfunction has many program areas. Title I11 does not state that-Congress must select an entire subfunction for comprehensive evaluation, but only a program area. Under the six-year sunset cycle, Congress would review nineteen subfunctions in the first two-year period, the same number in the second two-year period, and twenty-three in the final two-year period. Title I11 does not mandate the'number of program areas which must be subject to comprehensive evalua tion. It does not even require that any areas be so selected although the report on S2 by the Committee on Government Affairs states that "It is the intent of this section that a committee choose to select at least one program for evaluation within a Congress I If each oversight committee in the House and Senate chose one program area to scrutinize in detail over a two-year period how and in what detail would it accomplish the mandatory reviews as required in Title I, of all other programs=h the budgetary subfunctions which are subject to termination in each Congress?

For instance, the Senate Committee on Human Resources has juris diction over legislation relating to education, labor, health and public welfare, all of which would be subject to sunset in the 97th Congress (1981-1982 The seven subcommittees of this committee might each pick one program area to concentrate on. Would the many other program areas receive only cursory review and automatic reauthorization as is the case now?

The guidelines for comprehensive evaluation of single pro gram areas under Title I11 are more specific and detailed than the guidelines for the required reviews of all program areas under Title I. But S2 allows for much committee discretion as to what is appropriate for both reviews and comprehensive evaluations. -11 TITLE IV Under its major provisions, Title IV: establishes a non-partisan, independent, eighteen.-member commission with subpoena authority to study and investigate the organization and operation of the executive branch with the purpose of making recommendations "to increase the effective ness of government services, programs, functions and activities and requires the commission to submit a report of its con clusions by July 1, 1981, ninety days after which it will cease to exist ANALYSIS OF TITLE IV This Hoover-type commission would be authorized $12 million to carry out its three-year study. The personal expenses of witnesses appearing before the commission would be paid for by the government TITLE V Under its major provisions, Title V exempts twenty-one federal regulatory agencies from the first full cycle of sunset review established by the bill (The agencies would come under the authority of S2 on January 1, 1987 and provides for a pr'ivileged "sunset reauthorization bill" to. extend the budgetary authorization of a program in the event that its reauthorization is prevented due to a filibuster or other delaying tactic.

ANALYSIS OF TITLE V The twenty-one major regulatory agencies are exempted from the first full cycle of sunset because they are the subject of a companion sunset bill, S600 See analysis below Title V provides for a special sunset reauthorization bill that would defer for up to six years the operation of the sunset termination Congress must adopt a joint resolution to effect the deferral.

A sunset reauthorization bill for any program could not be considered by the Senate unless a budgetary reau thorization bill had been debated on the floor of the Senate for fifty hours. Appropriations for a program under a sunset -12 reauthorization bill could not exceed the amount of budgetary authority provided for that program for the fiscal year in pro gress. The entire apparatus is designed to prevent members of Congress from deliberately delaying congressional action on a reauthorization bill so long that the program is automatically terminated THE REGULATORY REFORM ACT OF 1977, S600 This sunset bill proposes an eight-year cycle of review of the thirty major regulatory agencies and the regulatory offices of the departments of Interior and Agriculture, a quarter of which would be reviewed every Congress, that is, every two years. The sunset reviews would be accomplished by the Presi- dent. His reports to Congress must include: recommendations for the reorganization or elimination of the functions, procedures and jurisdictions of the agencies, recommendations for the modification or abolition of federal regulations or agencies, recommendations for.:jlncreasing economic competition in the regulated industries, and a report on the impact of federal regulations on specific categories of industry.

Presidential reviews would be due for the following by April 30, 1979: the Environmental Protection Agency, Federal Energy Administration, Federal Power Commission, Nuclear Regu latory Commission, Federal Housing Administration, Occupational Safety and Health Administration and the regulatory functions of the Department of the Interior By April 30, 1981 for: the Civil Aeronautics Board, Inter state Commerce Commission, Federal Maritime Commission, Depart ment of Transportation, Federal Communications Commission the Currency, Federal Deposit Insurance Corporation, Federal Home Loan Bank Board, Board of Governors of the Federal Reserve System, National Credit Union Administration, Federal Savings and Loan Insurance Corporation, International Trade Commission Commodity Futures Trading Commission, Securities and Exchange Commission, Farm Credit Administration, General Services Adminis tration EOmmiSSion Federal' Aviation Administrati Federal" Trade By April 30, 1983, for: the Office of the Comptroller of By April 30 1985, for: the Consumer Product Safety I 13 Commission, Food and Drug Aclministratiori, National-High7 way Traffic Safety Administration, Nakional Labor Relations Board, Federal Mediation Board, Equal Employment Opportunity Commission, and the regulatory functions of the Department of Agriculture.

In addition, the House or Senate could demand the same extensive reviews on any other aqency which they wished to scrutinize. The.provision which requires a report on the im pact of federal. regulations on categories of industry (four categories which taken together are comprehensive) must be submitted as part of each biannual review, and updated with each new review. Both the GAO and the Congressional Budget Office would be required to submit, contemporaneously with the presidential reports, a report largely similar to the President's but also including a cost-effective statement for each agency.

If Congress did not pass reform legislation for an agency within fourteen months after each biannual presidential report the agency would lose its authority to issue new rules and regulations, Two months later, if Congress had still not acted the agency would lose its authority to enforce all rules and regulations and would be terminated at the end of the calendar year. Regulations "essential for preserving public health and safety" would be transferred to the. Departmentof Justice for enforcement Congress would have concurrent veto power over any regulation which it determined was inessential to the public health or.:saf ety ANALYSIS OF S600 The principal co-sponsors of this bill, Senators Percy Robert Byrd and Ribicoff, wanted to exclude the regulatory agencies from the sunset process of S2 in order to give the agencies time to reorganize before joining the rest of the government in the review timetable outlined in S

2. Under S2 the first cycle of the sunset review process, from which the agencies covered by S600 would be exempt, would end September 30, 1986, These agencies would become subject to S2 on January 1, 19

87. If passed without S2 as companion, S600 would provide for continuing sunset review for the regulatory agencies every ten years has a built-in system of making sure that Congress gets the information it wants about each agency. The details of what the President must include in his report are explicit. The provision which demands an executive department assessment of the regulatory impact on industry, if it is to be substantial at all, must necessarily require government consultation with the affected industries. Section four of the bill allows the relevant committees of Congress to disapprove any presidential S600, as introduced, is a tough straightforward bill which -14 review if it is inadequate under the guAelines for the reviews After disapproving, or if the President fails completely to issue a report, the committees themselves would prepare the reports.

The simultaneous sunset review bv the GAO and the CBO offer the members an assessment to comPare to that of the executive branch.

The sixteen month lau time between submission of the President's report and the sunset of the affected auencies should allow enouuh time for the Conuress to adeauatelv consider the merits of the asencies UP for sunset. Under S6

00. Conuress would be consider inu reauthorization or sunset of ten reuulatorv auencies everv two vears instead of a third of the federal uovernment as reauired bv S

2. Another essential difference between S2 andS600 is that the former scrutinizes the federal buduet and considers termination from the perspective of program, function (which concerns many agencies at once while the latter scrutinizes the-agencies themselves (and each agency's many programs) and considers reform or termination of their activities and the statutes which gave birth to them mental Relations, chaired by Senator Muskie, held hearings on S600 in May and June of 1977, but there has been no action on the bill since then. It is generally conceded that the possibili ties for passage of S600 are closely linked to passage af S2.

Another leuislative Possibility is that S2 could be passed with out the paragraph which exempts the regulatory agencies from the first cycle of sunset review. Thus, the regulatory agencies would not have any opportunity to reorganize before becoming part of the general sunset review system The Senate Governmental Affairs Subcommittee on Intergovern THE INTERIM REGULATORY REFORM ACT, S263 This bill concerns the seven independent regulatory com cissions: the Federal Communications Commission, the Interstate Commerce Commission, the Federal Power Commission, the Consumer Product Safety Commission, the Civil Aeronautics Board, the Federal Maritime Commission, and the Federal Trade Commission.

Each independent commission would be required to review the laws and court decisions which define its authority and recommend legislation to Congress that would streamline and recodify these authorizing laws would be authorized to appoint a director to conduct and super vise the review. Each commission would have to submit a report of recommendations both to the President and to Congress by October 1, 1980 The chairman of each commission ANALYSIS OF S263 The ages of these seven commissions range from ninety years the ICC) to five years (the CPSC The purpose of this bill is -15 I8 I I modernization and streamlining of authorizing statutes. No restriction of regulatory authority is contemplated for khe 1 I purpose of each commission is not in question; The success of the report each commission submits could depend on the independ ence of the director of each commission's study. The bill allows for the possibility of such independence for it does not require the appointment of each commission's director to be subject to the provisions of the laws governing appointments in the civil service. The Senate passed S263 on June 10, 1977, and sent it to the House where there has been little action. The Commerce Committee estimates the total costs for all seven reports to be 2.1 million over the authorized three-year period INTERIM REGULATORY REFORM ACTS, S1532-1537 SPECIFIC COMMISSIONS These six bills, originally included as parts of S263, con cern the same seven independent agencies'-'indivi&ualIy and would: require the commissions to recodify all the rules and regulations they have promulgated, require each commission to respond within four months to petitions concerning regulations, require tile commissions to submit their budget requests and legislative proposals simultaneously to Congress and the President, allow each commission to prosecute court cases if the establish a conf lict-of-interest policy by prohibiting Justice Department fails to do so former high-ranking agency officials from representing cases before a commission for two years after leaving it, require presidential appointment and senatorial confirma tion of commission chairmen, and specify the appropriations for each commission (except for the Consumer Product Safety Commission) for each of the next four years ANALYSIS OF S1532-1537 The Senate Commerce Committee decided to separate the lprovisions of these bills from S263 with the hope that the House would be more likely to pass at least some of them dur ing the first session of the 95th Congress. The bills were reported out of the Commerce Committee along with S263 on May 16. Since that time, S1532 (the Federal Maritime Commission 16 S1534 (the Interstate Commerce Commission S1535 (the Federal Power Commission and S1536 (the Federal Communications Com mission) have passed the Senate and have been sent to the House where there has been no action. S1537 (the Civil Aeronautics Board) has been delayed in the Senate because of a major bill which would vastly change CAB'S regulatory powers over the air lines, has been under consideration there.

The Commerce Committee chose to specify each commission's appropriations for the next four years but did not thereby establish a permanent cycle of four-year reauthorizations, as in the six-year cycle of S

2. Nor did it provide for any auto matic sunset termination of the commissions after four years In fact,.the committee report states that the committee is ready to raise the appropriation authorizations for any commission for any year if "it becomes evident that the authorizations for appropriations is too low." The Consumer Product Safety Com mission was excluded from budget reauthorization because it had previously been reauthorized two years ago. Under current law the other six commissions operate with permanent budget authority and yearly receive "such funds as are necessary." Also under current law, Congress does not receive copies of the budgets of the commissions at the time when they are submitted to the President, and in fact, the commissions have sometimes simply refused to allow Congress to see their detailed budgets.

While S263 would require the commissions to recodify the authorizing statutes by power of which they issue regulations these six bills would require the commissions to tidy up, but not change substantively, the regulations themselves. It is conceivable that the provision which forces the commissions to give timely consideration to petitions could result in less regulation since' the regulated community would better be able to oppose what it considers'ill-advised regulations other hand, the same provision would allow any "interested person" the same timely access for the purpose of proposing that a commission issue new regulations concerning some area under its authority violators of regulations to court under the provision which allows them to initiate court proceedings if the Justice Depart ment fails to do so when requested by any commission. Under current law, the Interstate Commerce Commission, the Federal Maritime Commission, and the Federal Trade Commission have limited independent powers of litigation of their own. These bills would substantially extend the powers of those three commissions and grant the same substantial powers for the'first time to the Civil Aeronautics Board, the Federal Communications Commission, The Federal Power Commission, and Consumer Product Safety Commission On the Finally, the commissions would be given new muscle to take -17 THE FEDERAL SPENDING CONTROL ACT OF 1977, 'S1244 Under its major provisions, this act: provides that no new authorizations be for longer than I four years, that existing programs be reauthorized within five years, that the reports on new programs or the reauthoriza tions of existing programs reflect a basic evaluation of the need for such program and of its probable (or actual) success ANALYSIS OF S1244 This bill, sponsored by Senator Biden, while seekin,g the same ends as S2, is far less elaborate and ambitious. S1244 limits the period of authorizations for any program and estab lishes a four-year review cycle, but it does not force review of all similar programs at the same time, as does S2 has been referred to the Senate Committee on Governmental Af fairs, but no hearing's .have been held The bill Tom Ascik Policy Analyst


Thomas R.

Senior Visiting Fellow