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Rules Affecting States

The 1995 Unfunded Mandates Act of 1995 required the Congressional Budget Office (CBO) to produce estimates of the economic impact of mandates affecting local, state, and tribal governments. Since 1995, there has been an observable trend downward in the raw number of rules affecting local and state governments. For example, in 1996, one year after the passage of UMRA, there were 674 affecting state governments in the pipeline. In 2017, there were 289 - a significant drop. There was a similar drop in rules affecting state governments. By one account, the number of rules affecting local governments had fallen by 67 percent, from 533 in 1995 to 173 in 2017.

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In August 1999, President W.J. Clinton signed Executive Order 13132, in order to "ensure that the principles of federalism established by the Framers, guide the executive department and agencies in the formulation and implementation of policies." This order mandates that all relevant executive agencies assess regulatory activity, such as legislation, rulemaking, or policy implementation, on whether or not it would have "a substantial direct effect on the states, on the relationship between the national government and the states, or on the division of power and responsibilities among the various levels of government." This category of analysis is labelled "Federalism Implications”, and is now a standard variable in the Unified Agenda of Regulatory and Deregulatory Actions published every six months by the OMB. The following series presents an overview of the flow of rules affecting state and local governments (rules affecting industry or business excluded).

The Unified Agenda of Regulatory and Deregulatory Actions describes Rules with Federalism Implications as those with "substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government." The first series (below) includes "Rules with Undetermined Federalism Implications," defined by UARDA as rules "at the prerule or proposed rule stages whose status cannot be clearly categorized."

Highlights

1.

Since the enactment of the Unfunded Mandates Act, the overall quantity of rules affecting state and local governments has fallen by 54%, from 1,140 total combined rules in 1997 to 526 in 2018.

2.

Rules with "undetermined federalism implications" constitute a significant portion of rules every year.

3.

Health and Human Services as well as the Environmental Protection Agency are the top two agencies with rules affecting states at 536 and 141 respectively. 

Sources
  • “Executive Order 13132 of August 4, 1999, Federalism.” Federal Register, title 3 (1999): 43255-43259.

  • "The Regulatory Plan and Unified Agenda of Federal Regulatory and Deregulatory Actions ” Federal Register.

  • Regulatory Review, Office of Information and Regulatory Affairs, Office of Management and Budget

Recommended

  • QuantGov is a sophisticated platform designed to help users sort through the enormous volume of federal, state, and local government policies, laws, regulations, court decisions, and other documents. Users interested in variation by state may want to consult the QuantGov "Total Restrictions" by state, which includes a "Federal Regulation and State Enterprise" (FRASE) index, which attempts to rank the 50 states according to the impact of federal regulation on the private-sector.

  • These cards focus only on regulations affecting state or local governments. Analysts have collected data that compares rules affecting state / local governments with rules affecting small business (e.g., Ten Thousand Commandments An Annual Snapshot of the Federal Regulatory State  Crews 2019)

"Regulatory costs are, in the words of American Enterprise Institute Scholar Peter Wallison, inherently 'squirrelly'"

The Federalism Index beta is going live.

 

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