House Republicans next week will call up a bill that tries to reduce the proliferation of unfunded federal mandates on state and local governments, companies and other entities.
In 1995, Congress passed the Unfunded Mandates Reform Act (UMRA), which was meant to stop the government from writing laws and issuing regulations that come with stiff compliance costs and not enough funding. But members of both parties say UMRA only went so far and that it needs to be strengthened and expanded.
UMRA requires the Congressional Budget Office to estimate the costs of legislative mandates and requires federal agencies to estimate the costs of regulatory mandates. It also makes it easier for Congress to eliminate legislative language that imposes too steep a cost.
While the law has helped to reduce unfunded mandates, critics say the law is not broad enough and contains too many loopholes. The House Oversight and Government Reform Committee made that finding when it approved the bill last summer.
"It has become apparent over time ... that UMRA — despite its good intentions and noble purpose — failed to curtail substantially the imposition of unfunded mandates," the committee found in a report on the bill. "The several loopholes, exemptions and exclusions embedded in the law are largely to blame."
Foxx's bill, H.R. 899, takes several steps to end these exceptions, including by extending UMRA coverage to independent agencies and giving the private sector more of a say over pending federal mandates before they're imposed.
The legislation would let a chairman or ranking member of any committee request a study comparing the authorized level of funding in a bill to the costs of carrying out the legislation on states and localities. Those costs would have to include lost business profits or costs passed onto consumers and would take into account possible behavior changes resulting from the mandate.
It also includes new regulatory procedures that require agencies to examine less costly regulatory proposals. The intent of this language is similar to another bill the House will consider next week that seeks to ensure all regulations are transparent and have the lowest cost effect possible.
"Each agency shall assess both the costs and the benefits of the intended regulation and, recognizing that some costs and benefits are difficult to quantify, propose or adopt a regulation, unless expressly prohibited by law, only upon a reasoned determination that the benefits of the intended regulation justify its costs," the bill says.
The bill has three Democratic co-sponsors: Reps. Mike McIntyre (N.C.), Collin Peterson (Minn.), and Loretta Sanchez (Calif.). However, it is likely to face resistance in the Democratic-controlled Senate.
It passed in a party-line vote in the House Oversight and Government Reform Committee, and the committee's top Democrat said the bill would slow down regulatory efforts to protect people.
"H.R. 899… would be an assault on health, safety, and environmental protections," Rep. Elijah Cummings (D-Md.) wrote in a dissenting comment in the committee report. "This legislation would erect new barriers to slow down the regulatory process and would give corporations an unfair advantage in the regulatory process."