OIRA 101

The Most Powerful Government Office You've Never Heard Of

The White House Office of Information and Regulatory Affairs (OIRA) is one of the most powerful offices in the entire federal government, and at the same time, largely unknown. Congress created OIRA as part of the Paperwork Reduction Act, passed at the end of the Carter Administration. Situated in the White House Office of Management and Budget (OMB), OIRA was intended by Congress to work on one of the Act’s primary goals – reducing the burden placed on individuals, businesses, and state and local governments when federal agencies asked for information. 

OIRA’s initial role was to approve “data collection requests” made by federal agencies, but the Reagan Administration quickly found it to be a handy lever for enacting its anti-regulatory objectives. And through Presidents Reagan, Bush, Carter and Bush II, so it remained. Through a series of executive orders, various Presidents authorized OIRA and its staff of economists to review most proposed and final agency regulations, making a tiny White House office the de facto gatekeeper for much of the federal regulatory system. The executive orders:

• Established OIRA as the central authority to review most draft and final agency
• Emphasized economic analysis in the regulatory process, focusing particular attention on maximizing the net benefits of agency rules;
• Established cost-benefit analysis as the primary tool for evaluating agency rules; and
• Empowered OIRA to reject or demand changes in agency rules.

Executive Order 12866, issued by President Clinton and still in effect, outlines OIRA’s regulatory gatekeeper role.  In January 2011, President Obama issued Executive Order 13563, which “reaffirms” the earlier order and adds some innovations of its own. Obama’s order directs agencies to develop plans for periodically looking back at their existing significant regulations (generally those regulations that impose a large economic impact or raise some policy controversy) to determine whether they need to be changed or repealed. Executive Order also added the promotion of “regulatory certainty” as a general goal of the U.S. regulatory system. (In July 2011, President Obama issued Executive Order 13579, which encouraged but did not require independent regulatory agencies to follow 13563.) Executive Order 13563 appears to be the result of the Obama administration’s process for revising 12866, an initiative that President Obama soon after taking office. At that time, President Obama also revoked Executive Order 13422, his predecessor’s order extending OIRA’s review authority beyond 12866’s mandate, to include agency guidance documents, or non-binding statements used to clarify existing rules and statutes. President Obama has nevertheless reasserted OIRA’s review authority over guidance documents through a March 2009 memorandum. 

Over the years, and through presidential administrations of both parties, OIRA’s regulatory gatekeeper role has become firmly ingrained in U.S. regulatory culture, even though it was established and has grown without congressional input or approval. For example, the cost-benefit analysis that Executive Order 12866 requires agencies to perform is inconsistent with most of the statutory mandates under which these agencies operate. Nevertheless, OIRA requires agencies to perform these analyses, and can demand changes in rules not adequately supported by them. Similarly, by statute, Congress authorizes agencies – not OIRA – to make the complex scientific and technical judgments that undergird regulatory decisionmaking, but the 55-person staff of OIRA, mostly economists, occasionally substitutes its own scientific judgment during the regulatory review process. These things happen now by habit and because Presidents find it convenient, not because Congress intended them.

The ‘Regulatory Czar’

The Paperwork Reduction Act established the position of Administrator to head OIRA. Given the influence this position has over the regulatory system, the OIRA Administrator is frequently referred to as the “regulatory czar” – a moniker applied to occupants of the office long before congressional Republicans made President Obama’s use of the term a talking point. The current Administrator is Cass Sunstein, whom President Obama nominated in January 2009.

Other Duties as Assigned

OIRA has additional responsibilities beyond its regulatory review role under Executive Order 12866 and its various responsibilities under the Paperwork Reduction Act. OIRA plays a role in implementing certain provisions of the Unfunded Mandates Reform Act, the Small Business Regulatory Enforcement Fairness Act, the Information Quality Act, the Regulatory Right-to-Know Act, and the E-Government Act. Most of these statutes direct OIRA to participate in panels or collect specified information from agencies and produce reports for Congress. Building off the Paperwork Reduction Act, the Information Quality Act also authorizes OIRA to help develop guidelines for agencies to follow in ensuring the quality of the information that they disseminate.