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Press Briefing by O.M.B. Director Leon Panetta, Jack Quinn, Chief of Staff for the Vice President, and Sally Katzen, O.M.B. Office of Information and Regulatory Affairs Administrator

September 30, 1993

The Briefing Room

11:35 A.M. EDT

DIRECTOR PANETTA: The President, at the beginning of this morning's meeting of the Cabinet, signed an executive order on regulatory planning and review. The action is a culmination of a process that he put in place immediately after his inauguration. At the time, he abolished the Council on Competitiveness and asked the Vice President to prepare recommendations for a new process for regulatory review. The Vice President convened an informal working group to develop these recommendations, and they formed the basis for the order that was signed by the President today.

The President's objective has been a regulatory system that works for the American people by both promoting and protecting their health, safety and environment, and at the same time, encouraging economic growth and job creation.

The process he directed us to implement is intended to regulate only when necessary, to do so cost-effectively, to relieve business of unnecessary regulatory burdens, to make the process more efficient and responsive, and to try to end special access for special interests.

Developing the process has obviously taken a lot of work and commitment not only from those within government, but also those outside government. Because it's a difficult problem, it's taken us many months, but we think we've achieved a balanced approach that establishes a system that we think will produce better regulations that will be more open and accountable to the public.

Now, within government, I want to thank those at the White House who have worked on this issue, especially Sally Katzen, who is the Administrator of OMB's Office of Information and Regulatory Affairs; Jack Quinn, who is the Vice President's Chief of Staff. Both of these individuals really drove this process and both of them deserve a tremendous amount of credit for what has been put into this document.

I also want to thank the representatives in the various agencies, members of Congress, their staffs -- especially those from the Senate Government Affairs and House Government Operations Committees. They're very interested in this issue, and we've had to coordinate this effort with them and work with them, as well as representatives of state and local governments, all of whom are directly affected by regulations.

Perhaps even more important is the contribution we received from those outside of government. We worked with businesses, as well as public interest organizations, to craft the fairest possible process. From the statements that have been handed out to you from many of these groups, I think it's clear that we've succeeded in bringing them together in this process.

Regulations are one of the most important ways, one of the most important ways in which government policy is implemented. They have a direct impact on the actions of individuals, businesses, nonprofit organizations and state and local governments. And they affect virtually every aspect of our life and our economy. How such regulations are crafted is one of the most serious challenges faced by government today.

The executive order that the President signed is not proregulation and it is not antiregulation, it's smart regulation -- regulations that achieve their objectives with the least possible burdens on society. It says first that regulations are to be adopted when and only when they are really necessary. They are to be based on the best reasonably available scientific and technical data. They are to rest on an analysis of the full cost and benefits of the proposed action. And they are to be crafted to achieve those benefits in the most cost-effective manner.

The executive order reaffirms that the agencies have the leadership role in developing federal regulations, as they should. They're the agencies that are responsible for implementing the loss that would pass by Congress. They're responsible for developing the legislation -- developing the regulations.

At the same time, it reaffirms the legitimacy and the necessity for having a centralized review system. The Office of Management and Budget, as an arm of the President, has a key role in that process. It targets OMB to review significant regulations rather than all of the regulations that we currently review. Many, many, hundreds upon hundreds of these regulations really are automatic and basically can go through. Now, they go through it in this kind of complicated process. The decision here has let us target significant regulations that demand our attention and our review and demand the President's attention.

The way our resources can be focused on these regulations is truly important, and we can avoid unnecessary delays, such as we have today.

The executive order sets forth clearly the responsibilities of the agencies, responsibilities of the reviewing entity, the Vice President's role in this process, and it makes the process more open and accountable to the public.

I think, in summary, the process represents a very sharp departure from the Competitiveness Council of the previous administration, which acted in secret, which stepped into regulatory issues at its own discretion, and which often did it at the behest of special interests. What we have done here is basically fix a process that everyone understands and knows. We have clear lines of authority. We have specific time requirements. And, most importantly, we have very specific disclosure requirements on contacts involving regulations.

There's no way for us, obviously, when you're dealing with regulations, to prevent all controversy, all contention that's involved in the regulatory process, nor is there any way for us always to make everybody happen when you're dealing with this process. The issues which we deal with are far too important and complex to resolve easily. But whatever the outcome, the American people need to know that the process has been open and fair, and that all sides have had a chance to participate.

Again, the support we have received from outside of government I think speaks eloquently for the good sense that has been employed in developing this executive order.

In short, this is good government. It has the support of various stake-holders in the process, and we are confident that it will be a viable base on which we can build a sensible, rational, regulatory decision-making process that promotes the interests of all of the American people.

What I want to do now is introduce Jack Quinn and Sally Katzen, who will say a few words and then respond to your questions. I've going to go back to the Cabinet meeting to talk about the National Performance Review and some budget problems. So let me introduce Jack Quinn.

MR. QUINN: No problems. He didn't say problems. Thank you. We really are quite proud of this executive order, frankly. And, in particular, as Director Panetta indicated, of the incredibly broad support we've got for it this morning. As I hope you heard, the order has been endorsed this morning by the Business Roundtable, as well as the Sierra Club, by the Chamber of Commerce as well as Public Citizen, by the National Federation of Independent Businesses, as well as OMB Watch. There are literally tens of other recommendations of endorsements that are coming in the door this morning, and we're most gratified by that.

This reflects, frankly, a process of consultation within and without the government that has been going on for six months and that has stretched across hundreds and hundreds of agency regulators, economists, lawyers, business groups, public interest groups, environmental groups and the like. What we've come up with, we believe, is a genuinely balanced and fair way of handling the regulatory review process in the future.

A couple of the highlights here -- this really will be, more than ever before, an open and public process. Information will be publicly available throughout the regulatory process under this order. The public will have access to the status of regulations, including where matters stand within OMB and within the Office of the Vice President. All information received by OMB from parties outside the Executive Branch will be available to the public.

The role of the Office of Management and Budget and the Vice President will, for the first time, be really quite fully articulated as it is in the executive order. We will, for once, eliminate both the star chamber approach that we witnessed for the last 12 years, particularly during the era of the Competitiveness Council, when matters were undertaken without any sense of who had responsibility for doing what. Significantly, we will engage in a much improved process of regulatory planning, the notion here being that if we plan the regulatory process well, we can avoid the 11th hour conflict between government agencies and we can avoid, frankly, the development of regulations that are exceptionally controversial.

The other thing that is of great interest I know to the business community is that we will undertake a comprehensive review of the existing regulatory burden, so that the process we're setting in place now will govern not only the development of new regulations, but the agencies and, in addition, the Vice President and the regulatory advisers to the President around the White House are given a mandate to undertake a complete review of the existing regulatory burden with the idea of eliminating regulations that have outlived their usefulness, but that are, nevertheless, continuing to impose significant economic burdens on society.

In addition to the order that the President signed today, he is issuing a directive to all of the Executive Branch agencies directing them to undertake at least one negotiated rulemaking in the upcoming year or to explain why it's impossible for the agency to do so.

The President is also this morning issuing a directive to the Office of Management and Budget, directing it to further streamline its regulatory review activities and to report back to the President and the Vice President by May of 1994 on its progress in this regard.

And finally, the President is issuing a memorandum instructing agencies to examine their internal procedures for the review of rule-making actions to determine whether they can be streamlined and to report back to him and the Vice President in that regard.

Finally, the White House Counsel is today issuing a memorandum to all Executive Office of the President staff, detailing the quite tight guidelines on contacts with both outsiders and with executive department agencies in connection with rule-making matters.

I'm happy to introduce Sally to elaborate further and, after that, we'll take any questions you might have.

MS. KATZEN: Thank you. I would just like to emphasize a few of the points that have been made that are at the heart of this. One is that the executive order is a balanced document, it is not a guise for some hidden ideology. And it looks to process, because it is our believe that if you have a process that is characterized by integrity, you will have better decisions, and that's the ultimate objective here.

Second, as Director Panetta indicated, this is a document that reaffirms the primacy of the agencies in the decisionmaking process, but recognizes at the same time the legitimacy of centralized review to coordinate among agencies.

And, third, the document clearly recognizes the importance of analysis in decision-making, the importance of thinking in terms of cost-benefit analysis, the discipline that may be imposed in that process, but it uses a broader definition to include nonquantifiable, as well as quantifiable, costs and benefits.

It has a strong emphasis on cost-effectiveness to achieve a given level of benefit for a lesser amount of costs, or the same thing to achieve more benefit for the same level of costs. And finally, stressing significance of scientific technical information in our decision-making. These are just all the regulatory tools that are used -- the analytical tools and it's a restatement of our conviction that these are to be used.

How OIRA will function differently in the future -- I think there are sort of four general themes that come out of this order. One is the selectivity, the focusing our resources on those regulations that are important. The language in the executive order is significant -- significant regulations. If we focus our resources where we really can add value, where we really will make a difference, and then we will also avoid delay, because we will not be worrying about some of the ones which are less consequential.

The second theme is involvement up front. Jack mentioned the planning process for agencies to think about their priorities and to coordinate among themselves. It's also significant when we -- OIRA -- becomes involved in the process. Right now it can take two months, two years for an agency to develop a regulation. All the time and resources that have gone into it, at the end of the process, they own it. And comments that come in at the 11th hour are not welcome, regardless of their merit. And so our intention is to become involved sooner, to identify the issues that may arise, and to make it clear to the agencies what type of analysis it would be anticipated that they should be putting together for the particular type of regulation they're working on.

A third general theme is coordination. There is created in this document a regulatory working group, which will have senior agency regulatory people to discuss cross-cutting issues of process, of methodology. Many of these agencies deal with the same kinds of issues. And whether it's how to do a cost-benefit analysis or comparative risk analysis or how to do a reg-neg, there are issues in which they can communicate better among themselves. And we're trying to facilitate that so that we work in a more collegial, cooperative environment.

Finally, we are emphasizing the openness and the accountability that is going to be the characterization of this process. OIRA has already made publicly available a list of the regulations we have received from the agencies. This was effective July 1st in our public reading room -- what we get from the agencies, when we get it, when we complete our review.

We have already begun making available a list of meetings with persons outside the Executive Branch to discuss regulations under review -- who has attended, what written materials they may have given us, what was the subject matter discussed. We invite to all meetings with outsiders representatives of the agency. We will make sure that there are notations of who attends and the subject matters discussed. We will make publicly available the documents that set forth differences of opinion between OIRA and the agencies. And we will make publicly available at the end of the process changes that result of a recommendation or suggestion by OIRA.

This is a dramatically different way of approaching it. It's a way that says we're proud of what we're doing; we want to do a good job; and we want the public to understand what we're doing so that it will confidence in the process and we can lay to one side all of the controversy about process and focus on the substance of regulatory decision-making.

He said to tell you what a reg-neg is -- negotiated rule-making is reg-neg. In negotiated rule-making, there was a statute passed a couple of years ago that encouraged the use of consensual-based rule-making. You bring the stake-holders to the table, you bring all sides to the table. Instead of having notice and comment in a written record, you get everybody in the room and you lock the door. You have a facilitator who tries to get consensus. It may take longer to get through the process, but, ordinarily, it means there's no litigation afterwards, which can save two, three, four years at the process. And it has been found to be very valuable. EPA, among others, has had it.

Q: A question about this openness that you're talking about. Does this mean that if a group is worried that, say, EPA is going to have a regulation and they try to get a meeting with the head of the EPA and they're successful in seeing the Administrator to lay out to their plan, that you will then know that the Administrator of the EPA had a meeting with some group about a regulation, or is this just the lower level?

MS. KATZEN: This order does not specifically address the processes that will be used at the agencies. Virtually, every agency in town has specific rules of process that set forth when they can have in that context ex parte communications. This seeks to describe the process for the Executive Office of the President, specifically for OIRA. If they want to have a meeting with me about that same rule that is being considered either at EPA or has been sent over to OMB for review, then you will know about that meeting. You will know who attended and what subject was discussed.

Q: But just to follow up, what you're saying is that this doesn't really -- in other words, that the back-door meetings that we have long come to expect as part of Washington where people are able -- lobbyists are able to use their influence to meet with Cabinet-level people or sub-Cabinet-level people -- that those don't necessarily need to be opened up and detailed under this?

MS. KATZEN: There has not been any kind of evidence of a problem in the past. And that has not been the kinds of issues that have been raised. EPA has its own rules, and no one, I think, has challenged that --

Q: I'm just using EPA as an example.

MR. QUINN: If I may, I think the problem was with the Competitiveness Council. The problem was with assistants to the President and the office of the Vice President and the manner in which folks here at the White House manipulated the rule-making process at the agencies. It has not in the past, to my knowledge, been a problem of people going in and meeting in closed-door sessions with agency heads. It has rather been a problem of what -- how the White House deals with the agencies. It is that process that we have specifically addressed in this order and --

Q: The answer is no?

MR. QUINN: -- and opened up. The answer to what is --

Q: To her question is no.

MR. QUINN: The answer is there's no problem. The answer is that --

Q: I know. But the question was whether this would forbid the kind of meetings she described. You're saying that you don't think they're a problem, but I take it this would not forbid the kind of meeting.

MR. QUINN: This order would not, but it is my belief that the rules of each of the agencies govern and prohibit those kind of contacts off the record.

Q: Just to clarify the differences between this order and the way the Competitiveness Council worked, in instances in which the Vice President is involved, may the Vice President have meetings with outside groups, and would those be noted in the record? When the Vice President, as opposed to OIRA, suggests changes or the Vice President's staff suggests changes, would they be noted and labeled on the VP's staff? And the last one, when OIRA asks for changes, and then you said they were going to publish it at the end of the record, isn't that the way they operated beforehand, or is that --

MR. QUINN: Let me try to identify what I think are the very significant differences. First, this order does not contemplate that the Vice President or his staff will be involved in the rulemaking process when that process is at the agency level. It is only at a later point in the process that we might become involved.

Secondly, as a result of the comprehensive planning function, it is our expectation that it would only be on about a half a dozen occasions a year that a matter would come to either the President or the Vice President for resolution.

Third, matters would come to them for resolution only where there is disagreement on the matter between or among Cabinet department heads, or between a Cabinet department head and OMB. The Vice President, the Vice President's staff, the President and the President's staff will not be available in this process for intervention based on the pleas of outside private parties who are disappointed with how well they fared in the regulatory process. I can't remember -- four or five. But the --

Q: What happens when he is involved?

MR. QUINN: At any stage of the process, if an outside party wants to provide information to be used in the regulatory process, it will have to be in writing and it will be provided to the affected agency for inclusion in its public docket.

Q: So no meetings? I mean, Quayle and his staff used to have meetings regularly.

MR. QUINN: Correct. Let me restate it. If an outside party comes in for a meeting, calls on the telephone, or otherwise communicates at an event or in any other respect and wants to provide information to influence the rule-making process, they will have to provide it in writing and it will be included in the public docket of the rule-making.

Q: Just to make sure I understand -- there could be a meeting, but you'd have to put it in writing and then it would be put on the docket?

MR. QUINN: Yes. Any information that one wants to provide to influence the rule-making process will have to be put in writing and included in the --

Q: But that's only clear -- that's only once it gets to OMB.

MR. QUINN: It is at any point of the process. At any point. At the agency level, when it's at OMB --

Q: That was my original question to you -- whether or not these kinds of meetings that are private meetings at the agency level are disclosable.

MR. QUINN: You asked a question about meetings with Cabinet department heads.

Q: Or sub-Cabinet or whoever is involved over there -- will we have a way of knowing that?

MR. QUINN: Let me distinguish the Cabinet department, sub-Cabinet people, and the White House people, okay? This order governs the activities of people in the Executive Office of the President. It does not, by its terms, address the conduct of Cabinet department members or sub-Cabinet people. The rules of their agencies govern their rule-making activities. This order makes clear that if people working in the White House or otherwise in the Executive Office of the President are to receive information from outsiders that will be used in the regulatory process, they have to receive it in writing and they have to transmit it in writing to the agency so that it's included, so that you will know.

Q: Okay. But it's only at the White House end that this regulation occurs, right?


Q: It's in the Executive Office of the President that these contacts will be disclosed?

MR. QUINN: By this order, Rita. As I said earlier, it is --

Q: Right, right, I understand that. We're just trying to figure out what the order covers.

MR. QUINN: Okay, the order covers contacts with people who work here.

Q: Who work here. That's the question.

Q: Does that include the Vice President? If the Vice President meet with Red Poling about something; and Poling starts complaining about some regulation that's in process that's going to stick it to his auto company or all of them, the Vice President is then to stand up and say, stop, I've got to take that in writing, must write all that down, I've got to add it to the docket over here?

MR. QUINN: The order governs -- the order does not restrict the activities of either the President or the Vice President personally, but it governs all of --

Q: Would it affect you?

MR. QUINN: Yes, it would. Every employee of the President and the Vice President here.

Q: On the issue of negotiated rule-making, is there a time limit set for reaching an agreement whenever there is a disagreement between agencies? And if there is, if the agencies involved are unable to reach agreement, is it then bumped up to the Vice President?

MS. KATZEN: The order sets forth very strict time limits for different types of regulatory actions. Along the rulemaking process, you might start with a notice of inquiry or an advanced notice of rule-making and get comments. Then it has a notice of proposed rule-making, and it has a final rule. And we have established different time limits that are appropriate to the type of regulatory action. And understanding that not all things should be treated the same thing, one size does not fit all. And so for an advanced notice, it's 10 days. For a notice of proposed rule-making. I think it's up to 90 days. If the final rule does not change in any material respect, it's less, and they're set forth in here, the different time limits with --

Q: Specifically for negotiated rule-makings.

MS. KATZEN: Negotiated rule-makings are handled exclusively at the agency again, and would be subject to the agency's own rules. The statute does not put any time limits on it, and ordinarily none are imposed, because the objective is to develop the consensus and not to have some hammer. So this does nothing to change how reg-negs are conducted at the agency. What it does is encourage the use of reg-negs.

Q: What if you get someone like OSHA and AMSHA, which have always been at loggerheads with each other, or notoriously have been, and they can't reach agreement on it?

MS. KATZEN: It may not be an appropriate thing for regneg, under those circumstances, if it's proven it's not going to work.

Q: I want to make sure I'm clarified on something, and then I have a question. It's my understanding, then, that as these communications come in, they will be made a part of public record as they occur, and not at the end of the process? Is that right?

MR. QUINN: That is right. I mean, in other words, communications with outside parties to -- for example, if representatives of a company or their lobbyist or lawyers tried to contact me in order to persuade me to contact an agency that is undertaking a rule-making, my obligation under this order would be to alert them to the fact that the matter is pending in a rule-making proceeding and that if they wish their views or their information to be considered in that rule-making, they would have to provide it to me in writing. When they do provide it to me in writing, it would be my obligation then immediately to transmit it to the agency for inclusion in the public record.

Q: And at that point I could come over and write a story saying that they have written this and are opposing this rule that is in progress --

MR. QUINN: Exactly.

Q: Now, it still strikes me that whether the Vice President's role is still somewhat restricted, that the role of OIRA is a little bit stronger in terms of reviewing regulations than you originally contemplated when he made the announcement dissolving the Competitiveness Council. Did you find yourself moving towards more requirement for review than you originally thought?

MR. QUINN: I think not. I think on the contrary.

MS. KATZEN: Yes. The original announcement was a memorandum from the President to Director Panetta which announced the termination of the Competitiveness Council and said that the existing executive orders on regulatory management would remain in effect pending a review of the process. And this particular order, which is the result of it, changes in significant respects -- one of which I think I put out in terms of the selectivity, another in terms of the time restraints. That I think it is a focusing of OIRA's interest in the area that is paramount here and not some sort of strengthening of the organization.

Q: You have mentioned significant regulations on a couple of times. Who's going to decide what's significant and how are they going to do that?

MR. QUINN: The order defines the term.

Q: Well, what does it say?

MR. QUINN: I'll let Sally answer that.

MS. KATZEN: The order gives four different touchstones. One has an important effect in the economy -- $100 million or more on an annual basis or otherwise adversely affects the economy, the environment or a sector of the economy. The second criteria is where an action taken or proposed would be inconsistent with an action taken or proposed by another agency. A third area is where there is a significant on-budget impact of a particular regulation. And I think the fourth raises a novel issue of legal or policy concern.

These are kinds of standards that are used. Some may say that they are not very -- not sufficiently specific. But we have had some pilot projects with various agencies. And when we have worked with them -- with a number of agency people, we'll sit around the room; we have three different regulations here -- we'll say, do people think this is significant; and all the heads nod in the same direction. They all either agree or they don't agree. But there's remarkable consistency, because when you're working on a reg, you know if it's significant or not. And I think that that will cause very little concern in the implementation phase.

Q: Sally, can I ask two business-related questions? One is, the review of existing regs. What happens to all the work that is done during a certain administration to do an inventory freeze, all that, are you starting from scratch? And, then, what happens at the end to make recommendations to Congress about eliminating reg?

MS. KATZEN: We had looked at what the Bush moratorium and Bush deregulations efforts had been, and there was, I think, a lot of effort that went into it. Timetables were imposed on the agencies, and they were supposed to come up with certain numbers. And the end result was not too terribly productive; people sort of found in the bowels of the agencies some reg that hadn't been used for the last 15 years, so they thought, ah, here's a great candidate that we can serve up and show how efficient we are.

We're going to try a slightly different approach, which is to look at significant regulations, particularly groups of regulations across agencies, and this is something which is going to be done on a consultative basis with the affected agencies and with the help of the policy advisors, and specifically the Vice President. And our objective here is to bring some rationality to that process.

Q: And make recommendations to Congress at the end of the process?

MS. KATZEN: Yes, there is a provision that asks not only to identify regulations, but any legislation that requires or mandates an agency to promulgate a regulation. There are instances where, sometimes Congress uses command and control and has designated a specific way of doing something which is now obsolete. And the agency keeps doing it because that's the legislative mandate, and we're asking them to identify it.

We would like to put some of these together and work with the process committees on the Hill, on gov affairs and gov ops, and the substantive committees who have jurisdiction to see how best to cut through some of this. But I find widespread support on the Hill for this work during the whole consultative process of this. We were singularly impressed by the extent to which the Hill would be supportive of a rational effort in this regard.

Q: One other quick question. How soon can we hear you guys establish some sort of administration policy on PRA authorization, on the paperwork aspect?

MS. KATZEN: I think the position that I had articulated during my confirmation was that the first priority was to get the executive order out. I think as Jack once said, walk it around the block a couple of times and make sure it really does work. Have some experience with it. One of the directives that Jack referred to earlier was a request from the President to me to do a six-month study and see how the process is working -- if it's achieving the ends we want. At that point, I think we'd be prepared to see the areas in which there continue to be, if any areas, where legislation would be salutary. And until that time, I think it would be premature.

Q: Let me ask you a couple kind of general things. One, you've referred several times to how this executive order accepts the legitimacy of centralized review. State the case for it. I mean, there are still a lot of people out there who think that centralized review is a bad idea, that the White House shouldn't be getting involved in this, OMB shouldn't be involved at all. So why do you need it?

And then the second thing is, you've talked about the regulatory working group and coordination. Are there any particular targets that you're going to look at first in terms of existing regulations that are particularly disparate that you want to try to bring together?

MS. KATZEN: If I could take the second question first, one of the objectives here is to have the agencies talk among themselves. And so, rather than having a preordained agenda, which we will impose upon them, I look forward to the first meeting at which we will have input from the agencies as to the type of issues they want to discuss. We have identified process issues, methodology issues. I know that there are some that the agencies have already asked us to consider. But I would like to have a full discussion with the agencies involved before we give you the list of what we intend to --

Q: Can you just give a couple of sort of general examples of the sorts of things --

MS. KATZEN: Well, how to undertake a cost-benefit analysis, whether there should be some rationality across agencies on comparative risk analysis were two that I mentioned earlier, and those are issues that have come up sort of repeatedly in a search for consistency, so that a product is not said to be bad by one agency and good by another, and how did these two agencies start talking with one another.

On the first issue of the legitimacy of centralized review, we have an increasingly decentralized government. Each department and each agency within departments has a statutory mission. It is sometimes very specific, sometimes more general. But they are focusing on what it is they are supposed to focus on. Transportation will focus on what Transportation is supposed to focus on. Energy will focus on what Energy is supposed to focus on. And, in doing that, concentrating on their legitimate function, as they should, they may be taking actions which will directly or indirectly adversely affect the ability of another agency.

One of the classic cases within DOT is you want cars safer, you make them heavier; you make them heavier, they're less fuel efficient. How do you reconcile the conflicting positions. And what centralized review does is it gives an opportunity from the perspective of the President's overall priorities to see how to reconcile and how to identify so that you can resolve potential inconsistencies among the agencies.

Please add more, lots.

MR. QUINN: Let me just add one point on this in response to that question. This order is part and parcel of the Vice President's National Performance Review and the broad cross-cutting approach that we're trying to bring to the work of these many agencies. As Sally has indicated, it's increasingly clear that the work of so many of the agencies bleeds into the work or affects, has consequences for the work of many of the other agencies. And one of the things that we're trying to do here as we're trying to do in so many other respects through the National Performance Review is to recognize the interdisciplinary requirements of dealing with the regulatory process.

When it comes to the work of the President's regulatory advisors reflecting, as they do, as you'll see in the order, the many policy councils here at the White House, when it comes to the work of the task force that Sally will run here bringing in the various agencies to work on cross-cutting issues, when it comes to, in fact, the very process of centralized review at OMB itself, these are all essential parts in our view of understanding the relatedness of so many regulatory initiatives and of dealing with them as they intersect.

Q: Can you explain how the calculation of costs and benefits will change? And has that been laid out yet? Is that in the order or is that still to come?

MR. QUINN: I'll say something quick, and then Sally can elaborate, because she knows a lot more about it than I do, as on so many of these matters.

The requirement of conducting cost-benefit analysis remains, and is still in this order. This order, at the same time, recognizes that both with respect to costs and benefits, there are sometimes nonquantifiable aspects of those costs and benefits. And though a cost or a benefit may not be capable of articulation in dollar terms. The order requires that those kinds of nonquantifiable costs and benefits nevertheless be considered in the process.

MS. KATZEN: Well done.

Q: Can I ask one other -- so I'm clear. Once it gets popped up to the Veep's level, as I understood what you were saying, and they thought of you first, probably, and so it's put on the record, but the Veep can still have meetings with whomever, a company or an enviro group on this issue? And, secondly, if the Vice President's staff makes recommendations to OIRA for certain changes suggests this rule is wrong in certain ways, will that be noted so we can tell the difference between OIRA and the Vice President?

MR. QUINN: I think the answer to the latter question is yes.

MS. KATZEN: Both the President and the Vice President are elected officials. And to restrict the people who can talk to them is something which has never been really an issue, never been on the table, never been suggested by those who have called for reform in this area.

With respect to communications within the White House, what the President may talk to me about, or what the Vice President may talk to me about is also something which has traditionally and legitimately been something which is not documented on the record.

If, as a result of that conversation, a change is made in the regulation, that fact will be known, and the fact will be known that it came as a result of a suggestion or a recommendation from OIRA. But whether I got it from the President or the Vice President is not going to be something which would be publicly disclosed.

Q: So let's say OIRA made the change but not the Veep's staff suggested or --

MR. QUINN: That's right. But again let me be clear here. The staff and the Vice President are not treated in the same fashion here. If that organization came to me and met with me, if it wants its views to affect the outcome of the rule-making process, I have to receive them in writing and I have to provide them to the affected agency for inclusion in the public docket.

MS. KATZEN: And that communication would then be available so that the reporter who wants to see who met with whom and how that squares with the ultimate result.

MR. QUINN: Oh, I'm sorry. Are you asking --

Q: That if you make a suggestion to her and that gets into the final rule --

MR. QUINN: I'm sorry. Whether I -- all right, the outsider comes to me. Whether I communicate with Sally or EPA, regardless, the fact remains that those views have to find their way -- I still have to send the views to EPA for inclusion in its public docket. Okay? Now, if I on my own initiative have a conversation with Sally about a rule-making, I don't have to put my own views in writing. But if I am acting as a conduit to pass on the views or information of an outside interest, I must pass them on in writing and they must be made available in the public docket or the rulemaking at the agency.

MS. KATZEN: That is the important point, because the criticism of the past, the concern of the past, was the Competitiveness Council and other avenues within the White House had become a back door for special interests, usually with some favoritism involved. And the Chief of Staff of that basically said this is a "leave no fingerprints" mode of operation. The problem was the conduit. It's perfectly alright to have communications within the government, but not on behalf of special interests. And that's the door we've closed.

THE PRESS: Thank you.

END12:20 P.M. EDT

William J. Clinton, Press Briefing by O.M.B. Director Leon Panetta, Jack Quinn, Chief of Staff for the Vice President, and Sally Katzen, O.M.B. Office of Information and Regulatory Affairs Administrator Online by Gerhard Peters and John T. Woolley, The American Presidency Project

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