THE PROBLEM

The process by which a rule is developed can be hidden from public view by institutional mechanisms, a lack of disclosure requirements, and government officials who would prefer not to disclose certain documents or communications. The opacities in the process are most acute during the pre-rule stage — the developmental phase of a rulemaking (before the publication of the Notice of Proposed Rulemaking (NPRM)) where federal officials make critical decisions on the direction of national policy.

White House review adds another hidden dimension to the regulatory process. During the Clinton administration, the Office of Management and Budget (OMB) began posting to its website a list of all rules under review and updates on OMB's decisions. During the George W. Bush administration, OMB began posting to the White House website a list of people from outside of government participating in meetings with OMB's Office of Information and Regulatory Affairs (OIRA) regarding rules under review. Although openness has improved, the website does not meet modern standards for transparency (e.g., it is not searchable). Additionally, the content of what is provided could be improved. For example, substantive reviews of regulations conducted by OMB, mostly done through oral, not written, communications with agencies, are not part of the public record. Increasingly, OMB input on a rule occurs prior to the formal regulatory review process described in Executive Order 12866 and is excluded from any form of transparency. This pre-rulemaking input can shape the regulatory outcome in undocumented ways.

Transparency in the rulemaking process is important for three main reasons. First, transparency leads to a greater sense of legitimacy from those outside government, improving both public support and compliance. Citizens are more likely to trust that a rule is in their best interest if they can follow and participate in the process. The regulated community is more likely to understand how to comply with a rule it has been able to follow in development. Second, where government is perceived to have erred, a transparent decision making process will provide citizens, stakeholders, Congress, and the courts an important tool with which to hold the proper official(s) accountable. Third, transparency is critical to public participation (discussed in the next section) because an open and well documented process will lead to better informed commenters and, presumably, more helpful comments. 

SUMMARY OF RECOMMENDATIONS

To improve transparency in the rulemaking process, the federal government should broadly adopt a strategy that moves toward a presumption of openness. This strategy is particularly important in the pre-rule, or rule development, stage where the bulk of policy formation occurs and can be shaped through undocumented interactions with OMB. Once an agency decides that an issue is a priority, that the agency has sufficient resources, has legal authority, and decides (or is directed) to regulate, the agency should create the rulemaking docket. The creation of this docket should signal the beginning of the period when all subsequent and significant actions, communications, and information should be disclosed, including those that may occur with OMB or the White House prior to any formal review process.

The Internet age has also redefined the concept of government transparency: Information should be available online in a timely fashion and in searchable formats to be considered truly transparent in modern society. New interactive technologies can make it easier to find and use information. For example, the government should use open programming interfaces (e.g., application programming interfaces, or APIs) to make sharing of information more possible.

Transparency also means the content of what is being disclosed must be complete. Rulemaking dockets must include all information relevant to the development of a rule, as well as information relevant to permitting and licensing. A tracking system should be established so the public can examine the progress of a rule from its beginning (e.g., at the creation of the rulemaking record or announcement in the Unified Agenda) to its implementation, as well as any paperwork requirements that may be associated with the rule.

In general, the recommendations in this report avoid imposing additional procedural requirements on agencies — there are far too many as it is. Achieving government accountability through a transparent and open regulatory process is the exception to this general rule. Information technology today makes it far easier to have transparent processes consistent with democratic principles.¹ 

DETAILED RECOMMENDATIONS

D.1.   Agency rulemaking dockets should be expanded, complete, and available online. Finding information related to a specific rulemaking can be difficult. Often, the only information an agency provides to the public at the time a rule is proposed or finalized is the text of the rule itself. Regulatory impact assessments, which identify, in monetary terms, the potential costs and benefits a rule may have to society, sometimes accompany a rule's release.

In July 2008, without prior notice, the Department of Labor sent to OMB a draft rule restructuring the Department's internal policies for the conduct of risk assessments. An entry on the OMB website revealed only the title of the rule; unlike other rules, the entry did not provide an abstract or proposed timeline. (Eventually, a draft of the rule was leaked to The Washington Post.) The Department did not consult experts inside the Occupational Safety and Health Administration or Mine Safety and Health Administration — the agencies the rule will affect. Instead, according to news reports, the Department based the rule on the report of a consultant who received a $350,000 contract to analyze the Department's current risk assessment regime. The Department refuses to release the consultant's report.

The public should have access to a broader range of information used in a rulemaking. The public also should have access to draft proposed rules and draft final rules sent to OMB for review. Agencies should include these drafts in the rulemaking docket in a timely manner so that the materials are available to the public as part of the notice-and-comment period. Disclosing a broader range of rulemaking materials would likely avoid the need for some information requests under FOIA and may help reduce the resources needed for FOIA actions. (See Recommendation D.3.)

Online rulemaking dockets should be among the primary vehicles for disclosure. Regulations.gov — the federal government's central location for online access to rulemaking dockets and public commenting — is in need of improvement, as will be discussed in the next section. If dockets are complete and material is posted in a timely fashion, Regulations.gov, and the federal government's online rulemaking docket system as a whole, will improve rulemaking transparency.

We believe it is essential for at least the following classes of information (identified in the subsections of this recommendation) to be included in rulemaking dockets. Disclosure should begin upon creation of the rulemaking dockets. Disclosure should occur as soon as possible after documents, communications, or other types of information described below surface.

D.1.a. Agencies should disclose online all studies in their possession related to a rulemaking, regardless of whether the study was used to inform the policy option the agency chose. Currently, agencies sometimes include in the rulemaking docket only the information that is directly cited in a rule. Other information to which the agency had access, but which it chose not to draw on or chose to ignore, is not included. The public may never find out about such information.

Studies, research results, and other inputs that could inform agency decision makers should be disclosed online, even if the information did not persuade or affect the chosen outcome. The public needs to have available in the administrative record all the information the agency had at its disposal during the decision making process so that interested parties can draw their own conclusions about the issue. Furthermore, existing law sets the foundation for disclosure of information during development of a rule.

D.1.b. Agencies should disclose online all written communications among federal officials from different agencies, including the White House, regarding rules under development or under review. Currently, the rulemaking process contains no requirements for disclosing communications made among federal offices. Agencies often have an interest in the rules other agencies are considering and the requirements those rules may impose.

OIRA purports to use the review period to mediate between an agency developing a rule and other agencies. Two problems exist. First, instead of serving as a mediator, OIRA often uses the period to challenge or alter the substance of a rule. Unlike agencies, however, OIRA often does not possess the requisite expertise to make substantive contributions. Second, other agencies with an interest in the rule may intervene in the rulemaking outside of the E.O. 12866 review period where communication and negotiation is even murkier. Transparency can serve as a check on these problems.

Officials outside of the agency developing the rule, including those in the White House, can have an enormous impact on the rule's substance. To avoid improper influence, whether real or perceived, the public should have greater access to the communications between and among officials. Therefore, written communications between and among federal agencies and White House offices should be disclosed to the public once the rulemaking docket is created.

The issuing agency should make available promptly in its online rulemaking docket any written communications between or among federal agencies and OIRA or other White House offices. This disclosure requirement should apply to communications made at any point during the rulemaking process, including the pre-rule stage (once the docket is created).

To improve transparency during the review period, agencies should look to Section 307 of the Clean Air Act as a model. The act states:

The drafts of proposed rules submitted by the Administrator to the Office of Management and Budget for any interagency review process prior to proposal of any such rule, all documents accompanying such drafts, and all written comments thereon by other agencies and all written responses to such written comments by the Administrator shall be placed in the docket no later than the date of proposal of the rule. The drafts of the final rule submitted for such review process prior to promulgation and all such written comments thereon, all documents accompanying such drafts, and written responses thereto shall be placed in the docket no later than the date of promulgation.

As mentioned above, we recommend this type of disclosure be extended throughout the rulemaking process, even before the agency submits a draft rule for review.

When OIRA chooses to reject an agency proposal, improved transparency among federal officials may also provide the public with a better understanding as to why the rule was insufficient in OIRA's view. OIRA provides in writing its reasons for returning a regulation under review for agency reconsideration. However, the written document most often does not convey the multiple interactions between OIRA and the agency. The final letter sometimes appears sanitized so as not to reveal the true reasons for the rejection.

D.1.c. Agencies should disclose online all substantive communications, written or oral, between any White House office and any nongovernmental entity regarding rules under development or under review. Currently, OIRA shares with regulatory agencies written communications it receives from nongovernmental entities regarding a regulation under review. It also invites agencies to any meetings that OIRA has with nongovernmental entities regarding a regulation under review. Finally, any meetings with nongovernmental entities are logged on OMB's website, which provides the general topic, the date of the meeting, and a list of participants.

In June 2007, the Environmental Protection Agency proposed changes to the national public health standard for exposure to ozone. EPA proposed a range from which it would choose its final standard. The proposed range was weaker than the recommendation of EPA's scientific advisors and staff. The public never learned why EPA ignored the advice of its experts or who made the decision to do so. However, many fear the White House, acting on behalf of industry, played a role. OIRA held three closed-door meetings prior to publication of the proposal — two with industry and one with public health experts. Neither OIRA nor EPA disclosed what was discussed during the meetings. Before publication of the final rule, which adopted the weakest end of the proposed range, OIRA held two more closed-door meetings with industry lobbyists. The nature of these meetings was not disclosed.

There are two problems with this system. First, it only applies to a regulation under review. Any substantive communication with nongovernmental entities regarding the development of a rule, such as those made during the pre-rulemaking stage, is not required to be provided to the agencies. Second, the content of oral communications, such as meetings, are not recorded or summarized.

Since OIRA can have significant influence in the outcome of a rulemaking, its actions should be documented in the rulemaking record, just as the regulatory agencies' actions are documented. The public should have a right to know about OIRA's communications with these entities.

To improve transparency between White House offices and nongovernmental entities, the president should require any White House office to document any substantive communications, written or oral, with nongovernmental entities regarding a regulation being considered. For oral communications, the date of the communication, who participated, and a summary of the communication should be written and made part of agencies' online rulemaking dockets.

Promptly after the meeting, if the agency was not already involved, the White House office should notify the agency of the meeting and provide the agency with any documents or meeting summaries. The agency should then post this information in its online rulemaking docket.

D.1.d. Agencies should disclose online all substantive communications between the agency and nongovernmental entities regarding regulations. The primary mechanism for nongovernmental entities to communicate with federal agencies about a rule is through the comment period following publication of an NPRM. These communications are currently disclosed in the rulemaking docket. However, nongovernmental entities also communicate with agencies outside of the public comment period. Currently, rules do not exist to govern disclosure of these communications.

Interest groups, especially those in Washington, with the resources and contacts to access agency decision makers are much more likely to engage in communications outside of the public comment period and off the public record, thus creating an imbalance. Small interest groups, groups outside of Washington, and individual citizens generally use the public comment period to comment on a rule, and the agency includes their comments in the public record.

Agencies should begin disclosing both written and oral communications made with any nongovernmental entity related to a rulemaking once the docket has been created. For oral communications, the date of the communication, who participated, and a summary of the communication should be written and made part of agencies' online rulemaking dockets. Written communications and the logs of meetings between nongovernmental entities and the agency should also be made part of the online rulemaking docket.

D.2.   Create a system that allows the public to track the status of a rule and its associated paperwork requirements. The rulemaking process as currently devised provides few mechanisms for the public to learn about a rule's status. Twice a year, federal agencies are required to announce the rules they have in the pipeline, their stage of development (i.e., early stages of development, proposed rule, or final rule), and an approximate timeline. The information is published in the Unified Agenda and is notoriously inaccurate.

Rules are given a Regulatory Identification Number early in the regulatory formulation process, but that identification does not necessarily always follow the regulation through its lifecycle. If the regulation is substantially revised, it may be given a new number, but there is no systematic way to trace its origins and connections to previous proposals. Moreover, there is no way to track paperwork that is associated with a particular rule.

OMB, in concert with the agency overseeing the e-rulemaking initiative (see Recommendation E.1), should develop a regulatory tracking system. Creating a tracking system may require federal agencies to establish online, searchable holdings of regulatory actions under development. The system should be updated regularly, giving the public a better indication as to the rule's progress and when significant rulemaking decisions have been made. It may take years to perfect the system, but the work should begin as part of the broader e-rulemaking project.

The creation of such a system would benefit both the public and the agency. The public would be better informed, earlier in the process (that is, before publication of the NPRM). If the public is better informed, an agency can better gauge public reaction and incorporate the public's views into a proposal during its formation, rather than after it has been fully developed and internally vetted. (The democratic benefits of public participation earlier in the process will be discussed in the next section.)

A tracking system would be a helpful tool for small business. For example, businesses could look up a final rule and find out what paperwork is associated with the rule. That way, a company could know more easily what is expected of it.

D.3.   To the extent permitted by law, agencies should make government information publicly available. Improvements to the FOIA process could aid in rulemaking transparency. Although FOIA's reach extends beyond rulemaking and into other areas of government information, improved access to a broad class of records can contribute to a better public understanding of how government works, including rulemaking.

Section (a)(2) of FOIA embodies the disclosure principles federal agencies should embrace. Under Section (a)(2), agencies are required to make publicly available certain categories of government documents, the contents of FOIA requests the agency has fulfilled if they "have become or are likely to become the subject of subsequent requests," and an index of those documents.

Currently, federal agencies are not fully embracing the spirit of Section (a)(2), in particular the clause in Section (a)(2) that requires them to make publicly available information they believe the public will request repeatedly, nor do most agencies keep an index of those documents. As with rulemaking information, it is important for government openness and accountability that agencies make such information available online.

Making greater use of Section (a)(2) of FOIA to make government information available online would greatly enhance transparency and public participation. Embracing Section (a)(2) would also benefit the agency because officials would not have to spend as much time processing duplicative, repeat FOIA requests. (See Recommendation D.1 above.)

By enacting the following recommendations, agencies can make strides in embracing FOIA's idea that government information be made available to the public in a timely way.

D.3.a. The president should instruct the attorney general to issue a memo calling on agencies to make government information publicly available under FOIA whenever possible. (See Recommendation 7 in "The First 100 Days: Recommendations for President-Elect Obama" section.) On October 12, 2001, then-Attorney General John Ashcroft issued a memorandum urging federal agencies to exercise greater caution in disclosing information requested under FOIA. The Ashcroft memo has prompted agencies to unnecessarily withhold government information from the public and, by encouraging agencies to battle the public over FOIA requests, worsened the FOIA backlog.

Ashcroft's memo superseded a 1993 memorandum from then-Attorney General Janet Reno that promoted disclosure of government information under FOIA unless it was "reasonably foreseeable that disclosure would be harmful." The Reno memo created an agency climate in which officials were more likely to share information with the public upon request.

Because this report relates to the rulemaking process, we have focused on the benefits of disclosing information related to rulemaking issues, not foreign policy or national security matters. However, to the best of our knowledge, the push for greater disclosure under the Reno memo never led to the release of government information that risked our national security or public well-being.

The president should direct the new attorney general to instruct agencies that the Justice Department will embrace the policy direction of the Reno memo to provide a defensible argument for aggressively disclosing information when possible. The president should act as soon as possible to send a message that the new administration stands for greater transparency.

D.3.b. Agencies should work to reduce the FOIA backlog. The FOIA backlog — the number of FOIA requests in the federal government's queue waiting to be addressed — continues to be a problem. In 2007, the FOIA backlog improved, but it still stands at 33 percent of the total number of requests processed.² From 2006 to 2007, eleven agencies did not make progress in reducing their FOIA backlog or presided over a worsening FOIA backlog.³ Severe FOIA backlogs are an impediment to transparency and public access.

Agencies should actively work to reduce FOIA backlogs. A new administration-wide directive on FOIA (see Recommendation D.3.a above) will help, as will making more information publicly available in rulemaking dockets, but agencies should take other steps as well. Agencies should devote more time and resources to fulfilling FOIA requests.

D.3.c. The president should request, Congress should appropriate, and agencies should use more funds to fulfill FOIA requests. As a general trend, the number of FOIA requests the government receives increases each year. The cost to the federal government of handling FOIA requests was more than $350 million for 2007.⁴

Because the FOIA backlog is so significant, and because FOIA requests are likely to increase each year, agencies will eventually require more funds if they are to make progress in reducing the FOIA backlog and to promptly handle new FOIA requests.

D.3.d. Agencies should develop plans for digitizing non-digital information. As mentioned above, the rise of the Internet has redefined the expectations for government transparency. For government information to be truly transparent, it should be available online.

Untold numbers of government documents predate the Internet age, and some new documents are in a non-digital format. Scanning these documents and uploading them to agency websites will be costly and time consuming.

Agencies should develop long-term plans for digitizing non-digital information. Agencies should plan to transition existing non-digital documents into digital, full-text searchable formats. Agencies should also plan to minimize the amount of new information that is created in non-digital and/or non-full-text searchable formats.

D.3.e. Agencies should not use the Confidential Business Information (CBI) claims under FOIA during public health emergencies. One of the nine FOIA exemptions allows agencies to deny FOIA requests if the information in question is "privileged or confidential" business information.⁵ Agencies can and do claim the CBI exemption during public health emergencies. For example, during meat recalls, the federal meat inspection agency has refused to disclose the names of retail outlets where contaminated beef has been shipped if the list of retailers is considered confidential. The agency may be legally protected in doing so, but not releasing the information unnecessarily puts the public at risk. During public health crises such as these, agencies should be disclosing CBI to the extent necessary to address the emergency. Where agency statutes do not provide authority to disclose CBI during public health emergencies, the Congress should provide necessary authority to do so.

D.3.f. Agencies should disclose online the calendars of senior agency officials. The calendars of government officials often provide valuable evidence of how officials and/or their staffs spend their time. Officials' calendars are often the subject of FOIA requests. In the spirit of FOIA Section (a)(2), agencies should disclose online the calendars of political appointees and senior career officials.

D.3.g. The president should ensure the FOIA ombudsman is housed at the National Archives and Records Administration, not the Department of Justice. The OPEN Government Act of 2007 created a new Office of Government Information Services at the National Archives and Records Administration (NARA) to serve as a FOIA ombudsman. It is to oversee the federal FOIA process and settle disputes within agencies. Although the Department of Justice holds the primary responsibility for enforcing FOIA, Congress saw fit to house the ombudsman at NARA in order to insulate it from political influence. In his FY 2008 budget request, President Bush attempted to move the ombudsman's office to the Justice Department.

The president should ensure that NARA has adequate resources to implement the new Office of Government Information Services.

ENDNOTES

1. See, for example, the American Bar Association's 2008 study on the status and future of e-rulemaking, entitled Achieving the Potential: The Future of Federal E-rulemaking, for a thorough evaluation of electronic rulemaking and recommendations for the future.
2. OpenTheGovernment.org, "Secrecy Report Card 2008: Indicators of Secrecy in the Federal Government," p. 11, available at http://www.openthegovernment.org/otg/SecrecyReportCard08.pdf, last accessed October 6, 2008.
3. Ibid.
4. Ibid., p. 10.
5. Use of Exemption 4, which covers CBI issues, has increased dramatically since 2003 in the aftermath of instructions from then-Attorney General John Ashcroft and White House Chief of Staff Andrew Card instructing agencies to make greater use of FOIA Exemptions 2 (internal agency rules), 4 (proprietary information and trade secrets), and 5 (inter-agency memoranda) in handling "sensitive" information. Use of Exemption 4 increased 46% in the five years since the instructions (2003 to 2007) compared to the five year prior to the instructions (1998 to 2002). In 2007, there were 10,136 uses of Exemption 4 by federal agencies. Source: OMB Watch analysis of data in Coalition of Journalists for Open Government, "An Opportunity Lost: An In-depth Analysis of FOIA Performance from 1998 to 2007," July 3, 2008,available at http://cjog.net/documents/Part_1_2007_FOIA_Report.pdf, last accessed November 3, 2008.