On February 2, the Office of Information and Regulatory Affairs (OIRA) issued Interim Guidance implementing President Trump’s executive order entitled “Reducing Regulation and Controlling Regulatory Costs.” OIRA’s guidance confirms that the order does not apply to independent agencies.
Trump’s executive order, which was issued on January 30, requires that whenever an executive agency proposes a new regulation for notice and comment, the agency must also identify at least two existing regulations to be repealed. Further, any new incremental costs associated with a new regulation must be offset by the elimination of existing costs associated with at least two prior regulations.
OIRA’s guidance explains that such requirements do not apply to independent agencies, such as the CFPB. The guidance does, however, “encourage independent regulatory agencies to identify existing regulations that, if repealed or revised, would achieve cost savings that would fully offset the costs of new significant regulatory actions.”
As we pointed out in a recent post, the CFPB’s exact status is in question because of the DC Circuit’s ruling last October that declared the CFPB an unconstitutionally structured agency. The DC Circuit remedied the constitutional defect by changing the CFPB from an independent agency to an executive agency. The DC Circuit has not issued the mandate because the CFPB has filed a petition for rehearing, so the decision has not yet taken effect. Thus, until OIRA issued its guidance, it had been unclear whether Trump’s executive order applied to the CFPB.
OIRA’s guidance confirms that unless the Trump Administration takes the stance that it need not wait for the PHH appeal to reach its conclusion before applying the DC Circuit’s ruling and considering the CFPB to be an executive agency, the CFPB is not obligated to comply with the executive order.
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