On January 20, 2017, Reince Priebus, the White House Chief of Staff and Assistant to the President, issued a memorandum to the heads of all executive departments and agencies ordering them to freeze the processing of all regulations. The stated intent of this action is to ensure that “the President’s appointees or designees have the opportunity to review any new or pending regulations.” At the outset, the memo states that, with the exception of regulations addressing any “emergency situations” or “urgent circumstances relating to health, safety, financial, or national security matters” and those subject to statutory or judicial deadlines, no regulations are to be sent to the Office of the Federal Register (“OFR”) until they have been reviewed and approved by an agency or department head appointed by President Trump and vetted with the Office of Management and Budget Director. In addition, new or pending regulations that have been already been sent to the OFR, but not yet published, should be withdrawn (consistent with OFR procedures).
While on its face, this memo appears to only affect those regulations that are currently under review and have not yet been published as final in the Federal Register, it is clear that the intention is to allow the new administration to re-evaluate final rules that have not yet taken effect and possibly even those that have. For those regulations that have been published in the Federal Register, but have not yet taken effect, the memo orders the agencies to temporarily postpone their effective date for 60 days from January 20th (not from the published effective date), for the stated purpose of “reviewing questions of fact, law, and policy.” Further, the memo states that in instances where it is permissible, the agencies should consider proposing a notice-and-comment period that extends beyond the 60-day moratorium.
Relying on the Regulatory Planning and Review Executive Order (“E.O.”) 12866 issued in 1993 by President Clinton, as well as E.O. 13422 (which amended E.O. 12866 to include, among other things, the definition of agency “guidance”) issued by President Bush in 2007, the memo employs a broad definition of the term “regulation.” In other words, the memo purports to require the review and consideration of any instrument, including guidance documents, memoranda and opinions that have a “binding” regulatory effect or would otherwise influence the interpretation of law by an agency.
While not plainly stated in the memo, the regulatory freeze may allow the incoming administration to identify already finalized regulations and potentially refer those to Congress for disapproval utilizing the Congressional Review Act (“CRA”) of 1996. Under the CRA, Congress can “disapprove” a regulation issued as a final rule by a federal agency by issuing a joint “disapproval resolution” within 60 legislative days of the regulation being referred to Congress. While the CRA has been rarely utilized, most notably due to the level of effort needed to pass each resolution and because of the threat of Presidential veto, it is likely to be utilized in this instance, in part because efforts are underway to streamline the process (e.g. H.R. 21 (“Midnight Rules Relief Act of 2017”) would allow the “bundling” of multiple regulations into a single joint resolution) and the same party controls both the Legislative and the Executive branches.
The potential effect of the memo is broadly sweeping, with numerous rules issued by the U.S. Fish and Wildlife Service, National Marine Fisheries Service, and other agencies, particularly in areas relating to endangered species likely to be reviewed and considered for their effects on the regulated communities. For example, on January 25, 2017, the wildlife agencies announced that they would be delaying the effective date for revisions to the Regulations for Candidate Conservation Agreements with Assurances from January 26th to March 21st. What is certain is that many of the regulations developed at the end of the Obama administration are unlikely to survive this process.