CHAPTER 5 REGULATORY NEGOTIATION: AN IDEA WHOSE TIME MAY BE ABOUT TO COME
| Jurisdiction | United States |
(Mar 1984)
REGULATORY NEGOTIATION: AN IDEA WHOSE TIME MAY BE ABOUT TO COME
Holland & Hart
Denver, Colorado
I. INTRODUCTION
A marked feature in the evolution of the American legal system over the past 25 years has been the burgeoning increase in the number, complexity and impact of governmental regulations touching virtually every facet of American life. It has been said that there exists at least one page of commentary and criticism for each word that Shakespeare wrote. The same is probably now literally true with respect to certain important Congressional acts (e.g., the federal Clean Air Act) and the regulations which implement them. Whether viewed as a necessary response to the diversity and heterogeneity of a continental-scale nation, or as a sign of "creeping bureaucracy," the fact is that Congress and the state legislatures have more and more resorted to the practice of enacting statutes which establish broad goals or principles, in turn requiring administrative agencies to propose, promulgate and enforce detailed regulations interpreting and implementing the legislative intent.
One result of this development is that the regulations developed through agency rulemaking will typically be the critical determinant of the force and effect of legislative enactments. Given the customary deference the courts afford administrative agencies which have duly completed rulemaking, the applicable substantive law will as a practical matter be heavily influenced if not determined by the final agency action in promulgating a rule. This is particularly true in the fields of environmental, safety and health regulation, where regulatory implementation of a Congressional act may require the agency to make an extremely technical evaluation and decision based on current scientific knowledge, which most courts will hesitate to overturn. Accordingly, attorneys involved in these and similar substantive areas, whether representing private industry or public interest groups, must be aware of both the problems and potential improvements in the rulemaking process.
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"Regulatory negotiation," sometimes shortened to "reg neg," is a process aimed at improving the procedural and substantive nature of the rulemaking process. Although virtually untested, it holds considerable promise as a possible avenue for more efficient, fair and effective rulemaking.
This paper surveys the genesis of the "reg neg" concept and discusses the first attempts to implement it by federal agencies. In addition, the author is engaged in an ongoing Environmental Protection Agency rulemaking proceeding which illustrates many of the problems with existing rulemaking procedures as well as certain of the opportunities and potential pitfalls of the "reg neg" method.
II. THE PROBLEM
As the importance and complexity of administrative rulemakings have increased, agencies have developed procedures which have formalized and extended the rulemaking process well beyond the relatively straightforward notice and comment procedures envisioned by Section 533 of the Administrative Procedure Act, 5 U.S.C. § 553. Such procedures no doubt help ensure that agencies develop sound factual bases for their decisions and otherwise help prevent arbitrary or capricious action, but the increased length, complexity and formalization of the rulemaking process has also had adverse consequences.
These issues were considered in depth by the Administrative Conference of the United States in the early 1980's, and in 1982 the Administrative Conference enumerated the problems affecting current rulemaking as follows:
°The affected parties in a rulemaking, as well as the responsible agency, tend to develop adversarial relationships with each other, causing them to take extreme positions, to withhold information from one another, and to attack the legitimacy of opposing positions.
°Because of the adversarial relationship, participants often do not focus on creative solutions to problems, on reasoned discrimination between key issues vs. peripheral issues, or on issues of implementation.
°Many participants perceive their roles in the rulemaking proceeding more as positioning themselves and preparing for subsequent judicial review rather than
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contributing to a solution on the merits at the administrative level. This litigation perspective may in turn result in the submission of massive written comments and the development of extensive factual records, often far beyond what is necessary.
°Long periods of delay often result; participation in the rulemaking proceeding can become needlessly expensive for all parties as well as for the regulating agency.
°There is little or no opportunity for participants in rulemakings to meet as a group with each other and with the agency to communicate their respective views, so that each can react directly to the concerns and position of the others in an effort to resolve conflicts. Public comments are often focused on criticizing the proposals of others rather than helping to develop creative solutions. The give-and-take sometimes necessary to develop a workable solution is rarely possible through the current commenting process. 47 Fed. Reg. 30701, 30708-9 (July 15, 1982).
III. REGULATORY NEGOTIATION: A POSSIBLE SOLUTION
In 1982, recognizing the foregoing problems and inefficiencies with current rulemaking, the Administrative Conference adopted a Recommendation for improving the efficiency of rulemaking. 47 Fed. Reg. 30701, et seq. (July 15, 1982). The Administrative Conference's "Recommendation No. 82-4" is the genesis of the concept of "regulatory negotiation" as now customarily used. The Conference's Recommendation, in turn, was based on a report prepared by Philip J. Harter.1
A minor stroke of genius of the Administrative Conference was to insist, from the start, on the idea that the goal of regulatory negotiation should be not just another layer of discussion but a practical and tangible result; namely, a draft of the text of the proposed rule. The Administrative Conference identifies the benefits of this approach as follows:
"...if the parties in interest were to work together to negotiate the text of a proposed rule, they might be able in some circumstances to identify the major issues, gauge their importance to the respective
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parties, identify the information and data necessary to resolve the issues, and develop a rule that is acceptable to their respective interests, all within the...
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