Question

In: Economics

what is agency rule-making? Explain

what is agency rule-making? Explain

Solutions

Expert Solution

Rulemaking is the process federal agencies use to make new regulations. These regulations (also called "rules") affect everything from the air we breathe and the food we eat, to the vehicles we drive and the roads we drive them on, to our health care and financial security. Congress passes the broad statutes that govern us, but most of the details are left to federal agencies to figure out through the rulemaking process.

Rulemaking can have different twists and turns, but this is the basic process for most important rules:

Getting legal authority :- The lifecycle of a new regulation begins when Congress passes a statute giving the agency power to make rules to solve certain problems or reach certain goals.

Sometimes, the statute tells the agency exactly what those rules should say, and how quickly they have to be made. Or It might limit what the agency can do by requiring, or prohibiting, certain kinds of solutions.

Drafting the proposal:-Many different people in the agency are likely to work on drafting the new regulation, including experts on the topic, economists, and lawyers. While the draft is being worked on, agency staff often get informal input from groups who will be affected. The agency might also hold public hearings. Or it might get the advice of a group of experts and stakeholders known as an "advisory committee."

Sometimes, the agency publishes an "Advance Notice of Proposed Rulemaking" (ANPRM) that outlines what it's working on and identifies important questions or areas where it needs more information. The idea is to get initial feedback and information from the public to help in drafting the proposal.

Predicting likely effects:-The agency must also analyze the new regulation's likely impact. In the “Regulatory Impact Analysis” (RIA), the agency has to predict the total costs and benefits of the rule to those who would be directly affected by it and to society generally (usually, over a ten-year period).
Drafting the Explanation ;-

Agency staff will draft a long explanation to go with the proposed new regulation. This explanation usually includes

what the agency is trying to dowhy it thinks it has the legal authority to do thisthe background of the proposal, including any steps that Congress, the agency itself, or other agencies have taken alreadythe studies, data or other information the agency has been using to draft the proposalany questions the agency still has or additional information it wantsalternative approaches it is considering, or has rejecteda summary of the RIA and other analyses

Possible challenge in court

:- If someone affected by the new regulation believes that the agency

:- exceeded the power Congress gave it

:- failed to consider something important raised in the comments

:- made an unreasonable decision

he/she may ask the federal courts to overturn the rule. It's very common for important rules to be challenged in court, sometimes by many different groups.

Enforcement:-

Once a rule is final and becomes effective, it has as much legal authority as a statute. Violating it can result in fines, loss of licenses or certificates, and sometimes even jail.

Especially with long, complicated regulations, the agency may have to explain what certain parts mean or what it will treat as a violation of the rule. These explanations are called "guidance." Agencies are supposed to make guidance documents available to the public on their websites.

Changing a regulation:-

In general, to change or repeal a regulation on the books, the agency must use the same process it used to make the rule in the first place.

Anyone can petition the agency to change or repeal any rule.


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